New Zealand's biggest bank, ANZ National, has posted an impressive $NZ520 million profit in the six months to March 31, which is a 7 per cent increase in interim profit and comes as its Australian parent ANZ reported a fall in profit.
The big unknown is whether growth in demand for loans that has driven New Zealand banks' profits, and offset tightening margins, will continue as the economy slows.
David Tripe, director of the Centre for Banking Studies at Massey University, said New Zealand banks were dependent on the housing market for lending growth.
"A slowdown in the housing market has potentially quite a significant impact on their overall performance," he said.
While Australian and New Zealand banks have enjoyed strong credit growth over recent years, higher interest rates are set to slow overall loan growth.
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