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ANZ New Zealand reported a strong rise in profit for the six months ended March. The New Zealand operation's cash profit was up 27% to $887 million and the statutory profit up 31% to $853 million.
The Australian-based parent ANZ beat market expectations with a record half-year cash profit of $A3.5 billion ($NZ37.7 billion).
Bank profits are always under scrutiny, but particularly this year, an election year.
ANZ New Zealand chief executive David Hisco said the result reflected significant reductions in costs due to the company's simplification programme, and above-market growth in home loans, strong lending to the commercial and export sectors, rapid growth in KiwiSaver and major reductions in credit provisions arising from management actions and an improving economy.
He predicted even better results in the future.
A fully-imputed interim dividend of 10c per share was declared.
''By leveraging our strong financial position and scale, this work is moving us towards our ultimate goal of creating New Zealand's best bank.''
The bank achieved good lending growth while maintaining net interest margin in a competitive credit environment, he said. At the same time, the bank had improved the quality of its portfolio.
Already the leader in the home lending market, ANZ increased its share by 0.44% in the current half-year while implementing the Reserve Bank's restrictions on high loan-to-value lending.
''We were in a position to honour all of our customer pre-approval commitments and continued to approve high LVR loans, while remaining within the Reserve Bank's limits,'' Mr Hisco said.
Westpac is forecast by Morningstar and Credit Suisse to lift cash earnings to a record $A3.8 billion from $A3.5 billion when it reports on Monday.
Credit Suisse says there will be a A5c rise in the dividend to A90c plus a A10c special dividend.
National Australia Bank, the owner of BNZ, in New Zealand, could be a relative disappointment, if a $A3 billion-plus cash profit could be called that.
First Union general secretary Robert Reid said the week had seen increased debate about inequality around chief executive salaries. Not only were banks repatriating large profits back to Sydney and Melbourne, they more than many companies, had massive disparity between worker and chief executive pay.
Bank profits were at record levels but the untold stories behind those profits was an intensification of pressure and stress on bank workers through aggressive sales targets, he said.
Mr Hisco's salary was more than $4 million, Mr Reid said.
''While the shareholders and those at the top of the bank are doing well, workers at ANZ continue to report unrealistic targets and work stress to their union.''
ANZ and First Union would soon meet for employment negotiations. Workers were ''absolutely committed'' to improve the stressful conditions many of them worked under, he said.
In Australia, ANZ shares were down A43c at $A34.04 after announcing its results. Westpac was down A34c at $A34.78, National Australia Bank was A41c weaker at $A34.89, but Commonwealth Bank was up 2c at $A78.92.