2 Comments 2 CommentsThe BNZ announced an after-tax full year profit for the past financial year of $741 million, Westpac revealed its after-tax profit had risen 22% to $707 million, ANZ made an underlying profit of $1.368 billion in the year to September, and ASB reported a 15% increase in cash profit to $580 million for the year to June.
But Thorburn said the reporting of those figures had been “misleading, lacking perspective and straight-out wrong in places” when he spoke to the Trans-Tasman Business Conference in Auckland on Friday.
“The banking sector in New Zealand right now is highly competitive, innovative and strong,” he said.
He said while BNZ’s cash earnings had increased 21% year-on-year, underlying profit increased 8.8%.
“As a return on our assets, our cash earnings equate to a return of about 1.2%, a level that would be unsustainable low in many industries.”
He said BNZ would keep its cash earnings in New Zealand this year to fund future investment and improve the bank’s capital base. Historically, the bank has paid an average of 65% of earnings to its Australian parent group as a dividend.
Thorburn said research by the NZBA showed that New Zealand banks performed well in terms of average return on equity, but were about average in a group of 47 NZX-listed companies when returns were looked at over the past five years.
The top performing bank is ASB, with a return on equity of 16%. TSB has 14.% and BNZ 14.3%. For the same five-year period, fast food business Restaurant Brands had a return on equity of 31.7%.
| « Resimac offers special launch rates | Home loan lending helps bank stability » |
Special Offers
Sign In to add your comment
© Copyright 1997-2024 Tarawera Publishing Ltd. All Rights Reserved
Last time I looked few industries had gearing anything like the banks.
Roll on Kiwibank!