The Bank of New Zealand reported an improved profit and a large jump in deposits yesterday as calls mount for the Government to provide some protection on customer savings.
Cash earnings for the BNZ's banking operations increased by $19 million, or 2.4%, to $807 million in the 12 months ended September.
Average lending volumes increased by $2.4 billion, or 4%, to $63 billion and customer deposits grew by nearly 11%, or $4.1 billion, in the period.
The Australian-owned New Zealand banks are regarded as among the safest in the world but New Zealand First leader Winston Peters says Kiwi savers are being let down by the Government, which is shirking its responsibility to protect their bank savings.
Finance Minister Bill English dodged questions in Parliament, failing to give an adequate explanation of why there was no guarantee on bank deposits, Mr Peters said.
Canada, the United Kingdom and Australia had a guarantee but the Government was setting New Zealand banking up for failure if there was a panic run on banks in the event of a disaster similar to the 2008 global financial crisis.
''Mr English seems to be suggesting those countries are wrong. Well, they probably know that when a financial crisis hits, it is too late to rush into a bank guarantee scheme. The guarantee given recklessly to South Canterbury Finance proves that.''
The cost to New Zealanders of losing all their savings in a crisis and the threat to the banking system would be far greater than having a scheme, Mr Peters said.
However, BNZ chief executive Anthony Healy, who was appointed in May, pointed to the results representing a ''solid underlying performance'' by the bank in an environment of intense competition and regulatory change.
''BNZ maintains a robust capital structure with a strong balance sheet well funded through diversified and stable funding sources.''
In February, the BNZ established a programme enabling it to raise term funding in the US market, further broadening the bank's wholesale funding base, he said.
The bank's core funding ratio was comfortably above the Reserve Bank minimum requirement of 75%. Collectively, the bank's funding and capital position was supportive of its long-term credit ratings.
The bank's net interest margin dropped slightly following customers' preference for lower-margin fixed-rate lending in a rising interest rate environment.
Mr Healy said a strong performance from the agribusiness division, supported by recent growth in home loans, had created momentum he expected to continue into the new financial year.
''The bank is having different conversations about money with New Zealanders.''
The bank's HomeAdvantage load meant the BNZ was the first bank in New Zealand to offer customers a credit card rate matched to a variable interest rate for the life of their mortgage.
The bank's 18-month-old BNZ KiwiSaver scheme had experienced fast growth and had $376 million under management at balance date, he said.
The bank paid $303 million in tax for the year and employed more than 5000 people in its nationwide network of branches.
Shares in National Australia Bank, the BNZ parent, were A10c higher at $A34.48 ($NZ38.80) after it said it was considering a public float of its troubled United Kingdom business.
NAB announced a 9.8% slide in its full-year cash profit to $A5.18 billion.
