A hot housing market has seen the country's biggest bank report a strong recovery in its full year profit.
ANZ's net profit for the year ended September rose 44 percent to $1.92 billion, after its bottom line fell to $1.34b last year due to the pandemic.
Chief executive Antonia Watson said the result reflected the record demand in the property market, a stronger-than-expected economy, and a reduction in the amount of money set aside to cover bad and doubtful debts.
Income rose by 2 percent, which was driven, in part, by home lending rising by $9.3b to $99b over the year - a 7 percent increase.
"High house prices continue to be driven by historically low interest rates and more demand for houses than are available," Watson said.
It was in everyone's interest that the market cooled, which was why it was the first retail bank to adopt higher loan-to-value ratios for investors, she said.
About $400 million was set aside for bad and doubtful debts last year but the bank was able to release $115m.
Watson said ANZ was able to do so because the economy had fared better than it had expected, there was strong global demand for local exports, and businesses had learnt from last year's lockdown and had adapted.
"Household and business confidence surveys recovered quickly and investment had picked up prior to the August 2021 outbreak."
The economic environment remained challenging and it was likely that uncertainty would persist as long as Covid-19 was a threat, she said.
Expenses fell 7 percent, as customer remediation was lower and one-off costs associated with the previous financial year were not repeated.
Customer deposits were up 3.5 percent, and overall lending rose by 6 percent.
KiwiSaver funds also grew by 16 percent from $16.4b to $19b.