Another major retail bank has seen its profits surge, driven by the strong economic rebound from Covid-19, high demand for mortgages and a lack of bad debts.
Photo: RNZ / Nate McKinnon
Bank of New Zealand's (BNZ) net profit for the year ended September was up 74 percent on a year ago to $1.3 billion - a record result.
Leaving aside one-off items, the bank's net profit was up a more modest 12 percent or $100 million to $1bn.
The strong result was driven by a $6.7bn or 14.6 percent increase in mortgage lending to $52.7bn.
It also added $37m to its earnings, as it reversed provisions set aside to cover band and doubtful debts.
The bank's loans and advances grew by 7.5 percent, supported by home loan growth, and other borrowings increased by 8.8 percent.
"BNZ is strong, stable and well-capitalised to support a business-led recovery," BNZ chief executive Dan Huggins said.
"We're being flexible and innovative, and backing customers to find opportunities."
Huggins said BNZ was the leading lender under the government-backed Business Finance Guarantee Scheme, and its own Good to Grow scheme had supported businesses with nearly $300m to help drive sustainability, productivity, growth and expansion plans.
According to the bank's parent, National Australia Bank, business lending grew by $400m or 1 percent to $41.5bn.
Huggins said the bank had supported first home buyers in a competitive housing market.
"In the last 12 months we have supported 4678 New Zealanders into their first home and partnered with Kāinga Ora on its First Home Partner shared ownership scheme that makes it easier for Kiwis to own their first home."
He said the bank also helped 11,764 New Zealanders to renovate and invest in their existing properties, while supporting the development of 1600 new builds.
Huggins said the bank was looking to incentivise environmental and social goals through its lending, to help transition to a low carbon future.
"Likewise, digital technologies have the potential to improve environmental outcomes and productivity, and last month we launched an initiative with Zeald to help transform businesses by accelerating their digital presence."
The value of KiwiSaver funds under its management rose by 24 percent to $4.1bn.