Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


ASB lifts annual earnings 11%, helping drive CBA growth

ASB lifts annual earnings 11%, helping drive CBA growth

By Paul McBeth

Aug. 13 (BusinessDesk) - ASB Bank lifted its annual cash profit 11 percent as it boosted mortgage and business lending, helping drive growth for parent Commonwealth Bank of Australia, while insurer Sovereign's earnings edged up 3 percent.

CBA's New Zealand banking unit increased cash profit to $776 million in the 12 months ended June 30 from $698 million a year earlier, on a 10 percent increase in net interest income to $1.5 billion, the Sydney-based lender said in a statement. Meantime, Sovereign's annual cash profit rose to $103 million from $100 million a year earlier on a 6 percent increase in insurance income to $201 million.

"The result was driven by a solid performance from ASB Bank with strong deposit volumes combined with improved margins and higher funds management income," CBA said in its report. "Sovereign profit increased on the prior year with strong persistency experience and solid growth in inforce premiums."

The New Zealand businesses were CBA's second-best performer in the year, lifting cash profit 19 percent to A$742 million, behind a 21 percent gain in Bankwest's earnings to A$680 million. The bank's group earnings rose 12 percent to A$8.68 billion on an 8 percent lift in total income to A$22.4 billion. The board declared a final dividend of A$2.18 per share, taking the total pay-out to A$4.01.

"We are cautiously positive about the outlook for the 2015 financial year," CBA chief executive Ian Narev said. "Whilst business and consumer confidence levels have remained fragile, the levels of underlying activity confirm the strong foundations of the Australian economy."

ASB increased its mortgage loan book to $41.58 billion as at June 30 from $40.31 billion a year earlier, while business and rural lending rose to $17.56 billion from $16.29 billion. Customer deposits rose to $40.15 billion as at June 30 from $37.72 billion a year earlier.

The bank fattened its net interest margin 13 basis points to 2.38 percent from a year earlier due to lower funding costs. That gain was offset by tight competition for business and home lending, and growth in lower margin fixed rate mortgages.

“Over the course of the financial year, all areas of the business have performed well with solid lending growth across all key portfolios of 5 percent, despite heightened price assertiveness in the home loan market,” ASB chief executive Barbara Chapman said in a separate statement. “The improving New Zealand economy has undoubtedly played a role with rising confidence and solid lending growth, particularly among business and rural customers.”

Sovereign increased its annual in-force premiums to $684 million as at June 30 from $654 million a year earlier, as it managed to improve its lapse rate in risk and health policies. The insurer experienced bigger claims at the beginning of the year.

CBA's ASX-listed shares last traded at A$81.69 and have increased 5 percent this year.

(BusinessDesk)

By Paul McBeth

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: RBNZ Keeps OCR At 3.5%, Signals Slower Pace Of Future Hikes

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5 percent and signalled he won’t be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected. The kiwi dollar fell to a seven-month low. More>>

ALSO:

Weather: Dry Spells Take Hold In South Island

Many areas in the South Island are tracking towards record dry spells as relatively warm, dry weather that began in mid-August continues... for some South Island places, the current period of fine weather is quite rare. More>>

ALSO:

Scoop Business: Productivity Commission To Look At Housing Land Supply

The Productivity Commission is to expand on its housing affordability report with an investigation into improving land supply and development capacity, particularly in areas with strong population growth. More>>

ALSO:

Forestry: Man Charged After 2013 Death

Levin Police have arrested and charged a man with manslaughter in relation to the death of Lincoln Kidd who was killed during a tree felling operation on 19 December 2013. More>>

ALSO:

Smells Like Justice: Dairy Company Fined Over Odour

Dairy company fined over odour Dairy supply company Open Country Dairy Limited has been convicted and fined more than $35,000 for discharging objectionable odour from its Waharoa factory at the time of last year’s ”spring flush” when milk supply was high. More>>

Scoop Business: Dairy Product Prices Decline To Lowest Since July 2012

Dairy product prices dropped to the lowest level since July 2012 in the latest GlobalDairyTrade auction, led by a slump in rennet casein and butter milk powder. More>>

ALSO:

SOE Results: TVNZ Lifts Annual Profit 25% On Flat Ad Revenue, Quits Igloo

Television New Zealand, the state-owned broadcaster, lifted annual profit 25 percent, ahead of forecast and despite a dip in advertising revenue, while quitting its stake in the pay-TV Igloo joint venture with Sky Network Television. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand

Mosh Social Media
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news