Growth in bank sector profits stalled last year after years of seemingly unstoppable development.
Business advisory firm KPMG's annual sector report showed the industry's collective profits fell just under 1 percent to $5.7 billion, with a growth in lending, while margins were squeezed slightly, costs rose markedly, and bad debts edged up.
KPMG's head of banking John Kensington said for all the controversy over capital levels, the treatment of customers, and a slower economy, banks remained in good health.
"They are in good shape, and that has a flow on effect for New Zealand because not many would have been refused a top up to their mortgage or an increase to their credit positive card balance, so there is a positive side to that financial strength."
Kensington said the industry appeared to have quietly accepted the Reserve Bank's decision to require higher levels of capital to strengthen bank balances for any future crisis.
The banks had talked of raising lending costs, rationing finance, or even closing parts of their businesses.
Kensington said he thinks the reaction is some years away yet, and it may be consumers doing the complaining.
"We may see some borrowers told they can't have that much, and if you can it's going to be at a higher rate and the complaining may be done by the public who feel they are being charged a bit much for a loan, or being able to borrow enough ... and the banks are going to say quite rightly that 'we're only doing what the Reserve Bank has required us to do'."
Kensington said the big future developments for the industry are the growth of fintech - digital based financial services - and open banking, which is where banks make their customers' data and details available to approved industry players, which could offer rival or alternative financial products.
He said the main banks seemed reluctant to push on quickly with open banking, and government would likely need to help make it happen, with the appropriate safeguards for consumer data privacy and protection.
Kensington added there was a "healthy tension" within the sector between the major players and new technology based finance companies.