(25 March 2010 – Australia) Westpac Banking Corporation says the quality of its lending assets is improving as Australia’s second biggest lender had a solid start to the year with good margins.Westpac says asset quality is showing early signs of improving as its watchlist and substandard loans declined.
The bank’s impaired loans and those 90 days past due were about the same level in the three months to December as the six months before that, according to a graph in a presentation in Hong Kong, released on Thursday.
Westpac said it had the lowest level of impaired assets among its peers.
The Sydney-based bank said its balance sheet was strong, with a Tier 1 capital ratio of 9.2 percent.
Its funding profile had also been strengthened with customer deposits representing 52 percent of total loan funding.
Westpac also said its funding duration had been lengthened over the past two years.
Customer deposits increased A$8 billion during the first quarter and the net interest margin was 2.2 percent, three basis points higher than the second half of fiscal 2010.
That had helped cash earnings to reach about A$1.55 billion.