(21 February 2005 – New Zealand) Kiwibank appears to be getting some traction, posting its first ever half year profit on the back of strong home lending.The bank reported a profit for the six months to December last year of NZ2.5 million compared with a loss of NZ1.5 million for the corresponding period a year ago.
Kiwibank was formed in 2002 by the New Zealand government which sunk NZ$72 million into the business. The bank is seen by many as a low fee, local alternative to the big five domestic banks which are all Australian owned.
Kiwibank chief executive Sam Knowles said the bank grew its mortgage lending business by 22 percent in the period to NZ1.22 billion – despite a home lending price war.
The bank said its customer base grew 20 percent to just under 300,000.
“The price war certainly had an impact on Kiwibank but we remained competitive in the market,” Knowles said.
The bank’s small business operation, which is still effectively a pilot, will be rolled out across the country in 2005.