BUSINESSDESK: Bank of New Zealand, the local unit of National Australia Bank, had a decline in third-quarter earnings, reflecting an increase in the charge for bad debts, which dropped to an "unusually low" level in the prior quarter.
The lender didn’t give details of the decline in BNZ’s earnings or the magnitude of the decline in the three months ended June in parent NAB’s statement to the ASX.
The increase was "primarily due to an increase in the charge for B&DDs (bad and doubtful debts) on business exposures from relatively low levels in the first half", the bank says.
Local customer deposits "grew strongly" in the quarter. The bank had retail deposits of some $33.5 billion as at March 31.
BNZ chief executive Andrew Thorburn told BusinessDesk in May the impairment charge on bad debt fell to an "unusually low" $34 million as at March 31.
The increased charge on bad debts bucked the group trend for NAB, which reported a 7% decline in impairments to $A524 million in the quarter. The parent reported a net profit of $A1.2 billion in the latest three months, with revenue down about 1%.
The Australian lender's business banking unit also reported an increase in bad debt charges as it increased provisioning on existing impairments and released collective provisioning to match the backing collateral.
"NAB delivered a stable result for the quarter and made further ground against its strategic agenda to strengthen the Australian franchise," group chief executive Cameron Clyne says.
"Although subdued business and consumer confidence continue to affect the Australian economy, we remain positive about the outlook."
The group's UK chief executive, David Thorburn, agreed to step down from the group executive committee to focus on restructuring the British business, which is overhauling its operation as it looks to cut 1400 staff.
NAB's shares fell 0.5% to $A25.05 in trading on the ASX yesterday and have gained 7.8% this year.
This article is tagged with the following keywords. Find out more about MyNBR Tags
Most listened to
- Business Week in Review with Grant Walker & Andrew Patterson
- “Cut the cuteness about cannabis reform” - Matthew Hooton
- Rodney Hide thinks Winston Peters will be the future Maori king
- Ethical investment in Kiwisaver - David Cohen vs. Matt Nippert
- Hunter’s Corner: Time for a line in the copyright sand