KEY POINTS:
Locally owned but pocket-sized Kiwibank and TSB Bank are shrugging off the international credit crunch, with state-owned Kiwibank this week notching up a 31.4 per cent increase in half-year net profit and TSB receiving an upgrade from rating agency Standard & Poor's.
Kiwibank said its rise in net profit to $22.7 million was largely driven by growth in net interest income.
Chief executive Sam Knowles said retail deposit growth of 20 per cent, to $4 billion, was enabling the bank to lift its lending. "We're not struggling like some of our competitors are with offshore funding."
Lending, including home loans, business banking and credit cards, rose 34 per cent to $4.8 billion. That figure included $670 million worth of loans acquired from HSBC.
But because of trouble sourcing funds from overseas, competitors were starting to get more aggressive in the deposit market.
On Thursday, S&P increased TSB Bank's rating a notch to BBB+ from BBB, "reflecting the bank's very good asset quality and profitability, above-peer capitalisation and liquidity, and solid regional franchise". S&P analyst Shaun Evans said TSB's loan-book track record was excellent.
