ASB Bank, the country's second-biggest, has posted a sharply increased profit on the back of a surging housing market and economic rebound from Covid-19.
ASB reported a net profit of $1.32 billion for the year ended June, a 39 percent increase on the previous year's $950m. Excluding one-off and unusual expenses the cash profit was up 34 percent to $1.29bn.
Chief executive Vittoria Shortt said the result reflected the economy's stronger-than-expected recovery from Covid-19.
"A decisive response from government and our banking system supported Kiwi businesses and households to be resilient during the pandemic."
The profit improvement was driven by a 10 percent rise in lending, with interest rate margins rising 6 basis points to 218 basis points (2.18 percent), and a $311m reduction in the amount set aside for bad and doubtful debts.
ASB's expenses rose 5 percent as it took on more staff and invested in technology, but its cost of doing business fell nearly 1 percentage point to 39 percent.
Shortt said the bank had helped 35,000 customers when the pandemic initially hit with some form of relief on $13bn of lending, as well as cutting fees. She repeated a promise made at the start of the year that there would be no forced owner-occupied house sales this year.
She said ASB has used the Reserve Bank's Funding for Lending programme to back new house building, farming environmental projcts, and business infrastructure and sustainability activities.