(2 May 2011 – Australia) The big four banks are expected to reach combined first-half profits of a record A$11.7 billion after the release of ANZ, National Australia Bank (NAB) and Westpac reports this week.Commonwealth Bank had already delivered its first-half profit of A$3.33 billion in February, and the other three banks together are expected to reach A$8.4 billion.
Expectations among senior bankers is that the recovery in business lending is starting to gain momentum and rebounding profits will provide further signs the financial crisis is receding, particularly for the Australian banks that have already reported that bad debts have fallen from their peak.
The return to profit growth is also expected to translate to dividend growth, with most analysts forecasting double-digit percentage increases. CBA gave its shareholders a 12 percent increase in interim dividends.
Results for the year to 31 March will confirm that revenue growth has been elusive for majors over the past six months while some may see a spike in soured loans following last summer’s floods in eastern Australia.
ANZ will start the string of results, with most tipping the bank will deliver first-half cash earnings of around A$2.81 billion. This represents a 24 percent increase over the same time last year.
Westpac will follow mid-week with most expecting an interim cash profit of A$3.1 billion, which is a more sedate 3 percent increase on last year.
Then National Australia Bank on Thursday is poised to report first-half earnings of A$2.54 billion, up around 19 percent on the first-half a year ago.