Westpac New Zealand, the local unit of Australia's Westpac Banking Corp, reported a 13 percent rise in annual cash earnings to $864 million helped by a rise in lending and improving bad debts.
Westpac's core earnings rose 3 percent to $1.22 billion in the 12 months ended Sept. 30, on a 2 percent lift in net operating income to $2.07 billion. Although impairment charges of $22 million for the second-half were up on the $4 million in the previous half, there was a 78 percent drop in the annual figure to $26 million compared to the previous year. That was a groupwide trend with Westpac group reporting a full-year decline in bad debts of 23 percent to A$197 million.
There was a 3 percent rise in Westpac NZ's second-half earnings on the back of strong growth in financial services and mortgage lending.
Total lending for the year was up 5 percent to $3 billion with mortgages increasing 6 percent to $2.1 billion, driven by good growth in mortgages with loan to value ratios of less than 80 percent. Business lending was also increased by $800 million or 4 percent, with agricultural lending particularly strong.
The New Zealand unit contributed 10.4 percent to the Australian-based Westpac group's record profit of A$7.6 billion. Westpac, Australia's second largest bank, announced a final fully franked dividend of 92 Australian cents per share, taking total dividends for the year to A$1.82, up 5 percent on the previous year.
