Mortgage advisers have increased their share of BNZ's home loan book, despite the bank maintaining a strong focus on its proprietary lending channel.

BNZ's full-year results show adviser-originated mortgages accounted for 40.8% of its $68.8 billion home loan portfolio at September 30, up from 39.3% a year earlier.

The proportion of lending through BNZ's proprietary channel fell from 60.7% to 59.2%.

These figures relate to the existing mortgage book rather than the proportion of new lending written through each channel.

BNZ refused to disclose flow numbers although they have previously and other banks including ASB and Westpac are upfront with this data.

The figures, disclosed in parent company National Australia Bank's investor presentation, show the adviser channel gaining ground as BNZ's home lending grows faster than the overall market.

BNZ increased its home loan book by 7.7%, or $4.9 billion, from $63.9 billion to $68.8 billion during the year.

This represented 1.4 times system growth, according to NAB.

New home loan drawdowns increased 14.5% from $16.5 billion to $18.9 billion.

The bank says its strategy is to maintain its leadership in business banking while expanding its relatively underweight personal banking business.

Despite the increase in adviser-originated lending, BNZ continues to rely more heavily on its proprietary channel, which accounts for nearly six out of every 10 dollars in its mortgage portfolio. It specifically calls out the performance of its in house channel in its results presentation.

BNZ's mortgage portfolio also shows a modest increase in investor lending.

Loans to property investors accounted for 35.4% of the book, up from 34.7%, while owner-occupiers represented 64.6%, down from 65.3%.

Fixed-rate mortgages increased their share from 85.1% to 88.1%, while floating-rate loans fell from 13.2% to 10.1%.

Interest-only lending edged up from 18.6% to 18.9%.

Mortgage arrears improved, with loans more than 90 days overdue falling from 0.21% to 0.18% of the portfolio. However, impaired housing loans increased from 0.12% to 0.14%.

Profit falls 23%

BNZ's statutory net profit fell 22.8% to $1.157 billion for the year to September 30, compared with $1.499 billion a year earlier.

The decline was primarily driven by a one-off reduction in capitalised software assets following a change in the bank's accounting policy.

Operating expenses rose 29.7% to $1.789 billion, while credit impairment charges increased from $27 million to $138 million.

Net interest income was largely unchanged at $3.048 billion, compared with $3.040 billion.

The bank's net interest margin fell 10 basis points to 2.30%, reflecting competition for lending and deposits.

Underlying profit fell 17% to $1.747 billion, although NAB's New Zealand banking segment reported a smaller 1.3% decline in underlying profit to $2.118 billion on its reporting basis.

Total loans and advances to customers increased 6.8% to $118.5 billion, while deposits and other borrowings grew 9.6% to $99.3 billion.

BNZ also reported that its consumer net promoter score ranked first among the five major New Zealand banks, while its business banking score ranked equal second.