Underlying profit falls, statutory profit rises
Bank of New Zealand (BNZ) reported an underlying profit of $1.075 billion for the six months to March 31—a 4.8% decline compared to the previous year—reflecting a challenging economic landscape and intense competition in the banking sector.
In contrast, statutory net profit increased by 4.3% to $795 million year-on-year.
“Overall, this is a solid result in the current economic environment,” said BNZ CEO Dan Huggins (pictured). “It supports our view that despite the current uncertainty driven by global trade and tariff tensions, New Zealand’s economic fundamentals have improved.”
The BNZ result followed Westpac New Zealand’s $525 million half-year profit—up 10% on the prior year—driven by stronger income but tempered by higher costs. Profit fell 9% from the previous half, while home lending rose 3% to $69.5 billion in a “highly competitive environment.”
Confidence in New Zealand’s economic recovery
BNZ attributed part of its result to an impairment write-back, citing improved local conditions.
“Looking beyond the current global volatility, we have confidence in the New Zealand economy and have delivered an impairment write back to reflect this,” Huggins said. “BNZ remains focused on supporting New Zealanders and New Zealand businesses.”
Customer growth and satisfaction boost performance
Huggins said that more than 50,000 customers switched to BNZ in the first half of FY25, as the bank continues to enhance service levels by investing in frontline staff and opening branches five days a week.
“It is also reflected in customer satisfaction, with BNZ moving into #1 position for our Consumer Net Promoter Score (NPS),” he said.
Lending and deposit growth strengthen balance sheet
BNZ saw total lending grow by $4.3 billion (4.1%), led by:
- Home lending up 5.6%
- Business lending up 2%
Deposits also rose significantly, increasing by $5.4 billion (6.8%). Term deposits remained dominant, but the bank’s Rapid Save high-interest account saw robust uptake, growing $1.7bn (13.7%).
Supporting first-home buyers and business innovation
BNZ supported nearly 6,000 Kiwis into homeownership, with first-home buyers making up almost one-third of all new home loans during the period.
“The economy appears to be at a turning point, and while uncertainty remains, BNZ is well positioned to support its customers,” Huggins said.
“We’ve supported nearly 6,000 New Zealanders with their homeownership ambitions… As New Zealand’s largest business bank, we understand that businesses will be at the forefront of our economic recovery.”
Innovation in open banking and fintech
BNZ is embracing innovation with the launch of Payap, New Zealand’s first digital wallet and point-of-sale app using open banking, compatible with all NZ banks.
Over 10,000 business customers have signed up for the platform, which could cut merchant fees by up to 80%.
BNZ also leads the local market in open banking adoption, with over 300,000 customers and 26 fintechs using its API suite.
Economic outlook: Cautious optimism
“Lower interest rates and strong conditions in the primary sector have helped support improvements in the New Zealand economy,” Huggins said. “However, trade tensions have created significant volatility and heightened uncertainty in global markets.
“We are watching these developments closely… However, we remain optimistic about the country’s long-term outlook and are committed to supporting New Zealand’s growth aspirations.”
