12 Feb 2014

ASB first half profit up

8:32 pm on 12 February 2014

First half profit for ASB rose 14 percent, reflecting solid lending growth, the strength of the wealth and insurance business, and improved profit margins.

Net profit for the six months to December rose to $416 million from $365 million in the period a year earlier.

Cash profit, the bank's preferred measure, was up 12 percent, slightly less than the statutory result.

Chief executive Barbara Chapman said the result reflects a strong performance across the bank's operations as well as better market conditions.

Ms Chapman said the 19 percent growth in revenue from the wealth and insurance business and the 30 percent growth in managed KiwiSaver funds were particular highlights.

She said the strengthening New Zealand economy, low interest rates and robust housing market helped the bank reduce charges against profit for bad loans by 25 percent to $21 million.

Lending rose 7 percent while customer deposits increased 10 percent, stimulated by customers focusing on building wealth and protecting their assets.