SBS holds its home loan market share

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SBS Bank’s September quarter net profit fell 12%, largely reflecting a drop in net interest income, while its share of the mortgage market held steady over the quarter.

Tuesday, January 5th 2010, 9:07AM

by Jenny Ruth

SBS Bank's general disclosure statement (GDS) shows net profit dropped 12% to $2.64 million as net interest income fell 7.8% to $14.23 million.

A 34.7% jump in other income, largely loan and other fees and insurance income, to $4.42 million in the three months was all but offset by a $4 million charge against profit for bad loans.

SBS's six month profit was up 16.6% to $6.26 million.

The bank's mortgage book grew by $30.8 million to $1.71 billion in the three months, holding its market share at 1.11%. Of the total book, $220.6 million were the government-backed Welcome Home Loans which accounted for 79% of SBS's mortgages with loan-to-valuation ratios above 90%.

SBS was the last of the home-lending banks to lodge its GDS. The stand-out features of the quarter were the government-owned Kiwibank's continuing rapid increase in market share, largely at ANZ Bank's expense.

Kiwibank's market share stood at 5.45% at September 30, up from 5.13% at June 30 and from 3.76% at September 30 2008. ANZ's market share (the combined share of its New Zealand subsidiary, ANZ National, and its New Zealand branch) has fallen from 33.77% at September 30 2008 to 32.85% at September 30, 2009. (The figures are distorted by ANZ National reporting under the Basel ll rules while the ANZ branch reports under the Basel l rules.)

Westpac and ASB Bank lost a small amount of market share over the year while the community-owned TSB Bank saw its market share jump from 1.25% over the year to 1.33%.

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