A positive contribution from derivatives trading and a resilient economy helped drive ASB Bank’s first half statutory net profit to a record $372 million, up 31.3 per cent from the previous corresponding period, the bank said today.
The bank’s result for the six months to December 31 compared with a statutory net profit of $283 million in the year-ago period.
Contributing to the result was a period-on-period increase in after tax fair value gains from derivatives of $48m.
Excluding these movements from both periods, the bank’s statutory net profit would have grown by 12.9 per cent, it said.
Meanwhile ASB’s parent company, Commonwealth Bank of Australia, which has along with the other major banks attracted negative media attention for raising interest rates in the last few days, reported a statutory net profit of A$3.62b for the six months — up 19 per cent.
ASB chief executive, Barbara Chapman said ASB’s performance was influenced by a combination of factors, including healthy revenue growth and productivity gains.
“More broadly, the strong result should also be seen in the context of the current low credit growth environment, which has seen constrained growth in lending and balance sheet size,” Chapman said in a statement.
Contributing to the performance was a fall in impairment losses of 61.1 per cent compared to the same period last year, as a consequence of improving asset quality over all sectors, including business lending, Chapman said.
Another key factor was the ongoing trend among home owners to switch from fixed to floating rate home loans – with floating rate home loans now representing a significant part of ASB’s home loan portfolio.
In the six months since July 2011, there had been growth in business lending as the market shows indications of increased activity.