NZ banking starts to recover
(7 April 2010 – New Zealand) The New Zealand banking sector has finally started to make a recovery after the NZ$1.2 billion (A$918 million) loss the sector suffered in the September quarter, reporting this time a tax-paid profit of NZ$1.05 billion for the following three month period, according to KPMG’s latest industry report.
The September-quarter results were largely affected by the larger banks being stung with a NZ$2.1 billion bill for back taxes and interest in a settlement with the Inland Revenue Department, which the High Court ruled to be tax avoidance, BusinessDay reported.
KPMG’s latest industry report revealed that Westpac took the top spot earning a NZ$340 million profit, followed by the Bank of New Zealand raking in NZ$271 million.
The country’s largest bank ANZ National reported a profit of NZ$253 million, while ASB revealed a NZ$164 million profit.
KPMG told BusinessDay that the results show a return to a more stable position despite a lower level of profitability than previous years.
The 10 to 15-basis-point reduction in margins over the last 12 to 15 months could indicate a ‘new norm’ level for margins, which have reduced 1.97 percent overall, KPMG said.
KPMG added that the majority of banks have announced substantial reductions in fees and charges, particularly for dishonour and honour fees as well as account and transaction fees. The reduced fee income will be evident in banks’ results during the 2010 year.
KPMG’s latest industry report revealed that Westpac took the top spot earning a NZ$340 million profit, followed by the Bank of New Zealand raking in NZ$271 million.
The country’s largest bank ANZ National reported a profit of NZ$253 million, while ASB revealed a NZ$164 million profit.
KPMG told BusinessDay that the results show a return to a more stable position despite a lower level of profitability than previous years.
The 10 to 15-basis-point reduction in margins over the last 12 to 15 months could indicate a ‘new norm’ level for margins, which have reduced 1.97 percent overall, KPMG said.
KPMG added that the majority of banks have announced substantial reductions in fees and charges, particularly for dishonour and honour fees as well as account and transaction fees. The reduced fee income will be evident in banks’ results during the 2010 year.
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