The result is driven by continued lending growth
ASB has reported a cash net profit after tax of $1,418 million for the 12 months to the end of June, up by $122 million, or 9%, on the prior year – a result driven by continued lending growth despite a challenging operating market.
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ASB home lending grew 6%, compared with 12% for the prior year, due to the slowdown in New Zealand’s property market, while its business lending grew 6%.
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The country’s fourth biggest bank posted an 8% lift in its total operating income, while its net interest margin was flat on the prior year as it grappled with the impacts of a rising interest rate environment and volatility in swap rates.
ASB also posted a cost-to-income ratio of 37.1% on a cash basis, a decrease of 190 basis points, while operating expenses increased 3%. The bank said the underlying growth in operating expenses of 9% reflect continuing investment in people, technology, and regulatory compliance, including the first phase of a large multi-year strategic investment, to deliver innovative future experiences for customers.
ASB’s loan impairment, meanwhile, increased $46 million, reflecting portfolio growth and increasing provisions for emerging risks including inflationary pressures and rising interest rates.
