BNZ not targeting NBNZ customers

The bank’s net interest margin has risen 9 basis points over the past year. It now sits at 2.39%.

BNZ's cash earnings rose 21 per cent to $741 million in the full year to September. On an underlying basis, its profit was up 8.8%.

BNZ home loan lending is worth $28 billion and while chief executive Andrew Thorburn said the bank’s market share remained flat, at 16.1%, it was growing with the market.

“As the housing lending market grows, our share follows. It increased 2% over the year.”

He said the bank’s mortgage lending book had grown by about $1 billion over the past 12 months. “We also have a significant market share in business lending.”

Thorburn said the interest margin was important because it was a big source of the bank’s ability to invest. It fell after the global financial crisis but had returned to a sustainable level.

It had been suggested by commentators that disgruntled National Bank customers might move to BNZ but Thorburn said his bank did not target any particular clients and would not speculate on how many had made the switch.

“We’re focusing on our own game plan, wanting to pick up quality clients, wherever they come from.”

Retail deposits rose more than 10% to $34.5 billion, with the bank's market share of deposits increasing to 18.8 per cent.

Thorburn said deposit funding was important for banks operating in New Zealand and reduced reliance on overseas funding. He said competition in the sector pushed costs up but the competition for home loan clients maintained downwards pressure on mortgage rates.

BNZ's big return comes a week after the country's largest bank, ANZ, reported a record full-year profit of $1.27 billion, up 17%. That followed ASB's full-year profit of $658 million, up by 11%.

Comments from our readers

On 12 November 2012 at 1:06 pm SP said:

I'm sure ANZ/NBNZ will play its cards close to its chest but are there any indications that significant customer numbers are leaving them since the merger? I took the opportunity of to move to Kiwibank after 30+ years with NBNZ. I'd rather my bank was making billion dollar profits for the govt that Aussie shareholders!

On 19 November 2012 at 8:08 am SW said:

I have to laugh at people who think NBNZ is now Australian owned. It has been for ten years. I'm not moving my mortgage. Particularly to a bank with a lower credit rating. They will eventually have to pay more for their funding and Kiwibank customers will have to pay for it. Although they may not notice...

BNZ not targeting NBNZ customers

Competition in the home loan market is keeping lending rates sharp, BNZ’s chief executive says, despite results, announced yesterday, that show the bank is making more money from lending than it was this time last year.

Thursday, November 1st 2012, 6:20AM 2 Comments

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