ANZ NZ profit up 20 per cent to $2.3 billion

ANZ NZ has released its full-year result. Photo / Steven McNicholl

ANZ New Zealand's net profit after tax has jumped 20 per cent to $2.299 billion in the year to September 30.

The country's largest bank made a cash profit of $2.064 billion, up 8 per cent on the prior financial year.

ANZ NZ chief executive Antonia Watson said the 8 per cent rise was a result of pent-up economic activity after the pandemic and a buoyant housing market.

"Coming into the 2021-2022 financial year we didn't anticipate the New Zealand economy would hold up as well as it has," Watson said.

"While inflation and supply chain problems, particularly for importers and exporters, were an issue for many customers throughout the year, the desire to get back to some kind of normal kept consumer spending up."

Watson said the housing market had been strong for most of the financial year although it had quietened significantly in recent months, after four Official Cash Rate (OCR) rises since May.

Home lending increased $5.3b to $104b over the 12 months to 30 September 2022.

ANZ NZ's net interest income rose 10 per cent to $3.761b while its expenses increased just 2 per cent to $1.646b which the bank put down to higher investment spend and inflationary impacts.

But its credit impairment's increased substantially from a $115m release in FY21 to a $39m charge in FY22.

Watson said the uncertain economic environment was the main reason for ANZ increasing its credit impairment provisions to $751m, with a $39 million charge recognised for FY22.

"At the moment, the vast majority of customers are in a sound financial position but we know that many will roll off fixed home loans onto higher rates over the coming year. When that happens some will be under financial pressure."

She said ANZ NZ had in recent months stood up a team to closely monitor customers for signs they might be concerned about managing their finances or coming under financial pressure as interest rates rise and the economy slows.

It had also bolstered the bank's customer financial wellbeing team and was proactively reaching out to those who showed signs of needing reassurance and support.

Watson said it wasn't in anyone's interest for people to get into financial stress.

"That's why we're keen to talk with customers sooner rather than later if there are any signs of problems to see if, for example, we can structure their finances differently to relieve some pressure."

Deposits rose 4.2 per cent while net loans and advances were up 4.5 per cent.

Funds under management fell 12 per cent to $34.3 billion after its default scheme members were transferred to other provider and the wind up of the Bonus Bonds scheme.

Parent company ANZ Banking Group saw its net profit rise 16 per cent to A$7.119b while its cash profit was up 5 per cent to A$6.55b. It will pay a A$1.46 dividend, up A4c.