Fee cuts and digital upgrades sharpen Kiwibank’s customer edge
Kiwibank has posted a stronger half‑year result as more New Zealanders shifted their home loans and savings to the state‑owned bank, cementing growth well ahead of the wider market.
For the six months to 31 December (1H26), the bank reported net profit after tax of $103 million, up 12% on the prior comparable period. The improvement was driven by robust balance sheet expansion and a more favourable credit environment, although the bank acknowledged some households are still under financial strain.
Total lending increased by $1.8 billion, taking Kiwibank’s loan book to $37.6 billion. Retail home lending was the standout, rising $1.3 billion and growing 1.6 times faster than the market. Over the half, Kiwibank captured 13% of all net new bank mortgage lending, helping 6,213 customers into homeownership and more than 3,000 borrowers to refinance onto its sharper rates.
“In a tough period for many, more Kiwi chose to bank with us. We supported businesses to expand, helped more customers get on the ladder as our lending continued to grow faster than the market, and had strong deposit activity as Kiwi backed a purpose-led, New Zealand-owned alternative,” Chief Executive Steve Jurkovich (pictured) said in a media release.
Business lending rose $0.4 billion to $8.7 billion, while deposits climbed $1.4 billion to $31.8 billion. Net interest margin eased to 2.18%, from 2.29%, reflecting intense competition and higher funding costs.
Customer value focus: sharper pricing and lower fees
Kiwibank said it remained focused on making banking “simpler, fairer, and more competitive” by combining aggressive pricing with lower everyday charges.
The bank continued to offer market‑leading or joint‑leading rates on key home loan and deposit terms, and highlighted that its home loan customers are repaying mortgages faster than the broader market, helping them build equity sooner and reduce long‑term interest costs.
It also removed 12 everyday banking fees, including Visa Debit annual fees, overseas ATM withdrawal charges and card replacement fees, and reiterated that its Retail Online Call account pays the full rate to every customer with no conditions or hidden hurdles.
“We focused on delivering the most value for the greatest number of customers and we did that by helping Kiwi to build equity in their homes faster while growing their savings and benefiting from lower fees,” Jurkovich said.
Investment and capital support growth ambitions
Kiwibank continued to invest in its multi‑year transformation, including upgrades to digital banking and payments, stronger fraud and scam protections, and ongoing work on a new core banking platform.
“Our transformation is about building a modern, resilient bank that can deliver new and competitive products faster and give customers a better experience,” Jurkovich said.
The bank also maintained New Zealand’s largest physical banking network, providing face‑to‑face access nationwide.
In December, parent company Kiwi Group Capital decided not to proceed with a previously signalled equity capital raise, after Kiwibank’s successful $400 million Tier 2 issuance and changes to Reserve Bank capital rules meant the bank could fund its growth strategy without seeking additional equity while staying focused on its Purpose of Kiwi making Kiwi better off.
Outlook: growth and competition into 2026
With lending and deposits still expanding faster than the market and business confidence expected to improve, Kiwibank said it is well placed heading into the second half of the financial year. The bank expects broader economic activity to pick up through 2026, even as global uncertainty and cautious household spending persist.
“We continue to back our customers through the good times and the tougher times as we build a stronger Kiwibank that drives more competition in New Zealand for the long term,” Jurkovich said.
Get the hottest and freshest mortgage news delivered right into your inbox. Subscribe now to our FREE daily newsletter.
