Kiwibank today announced a net profit after tax of $57 million for the 12 months to 30 June 2020, down from $108 million on the prior corresponding period.
“As expected, this result reflects the impact of COVID-19 and a lower interest rate environment on the bank,” said Kiwibank Chief Executive Steve Jurkovich.
“At the same time, we continued to increase our investment in good customer outcomes and our transformation to be an even better bank.”
Mr Jurkovich said the bank recognised $51 million in credit impairment provisions, up from $12 million on the prior corresponding period. The increase reflects the bank’s current view of the impact of COVID-19.
Operating expenses also increased, driven by an increase in investment to support the bank’s growth, good customer outcomes and transformation.
“Kiwibank continued to grow at a faster rate than the market, with lending growth of 9% and deposit growth of 13% in FY20. The market grew at a slower pace of 5% and 9% respectively,” said Mr Jurkovich.
"As a result, we are growing our lending and deposit rates faster than the market to help more New Zealanders into homes, more Kiwis to save, and support more businesses – living up to our purpose of Kiwis making Kiwis better off."
Mr Jurkovich said the bank had taken a leadership role during lockdown, prioritising the health and safety of its people and providing much needed support for customers and suppliers. Highlights included:
“Looking ahead, we will continue to play our role in New Zealand’s economic recovery by offering a better banking alternative that’s committed to being fair and easy for Kiwis, the businesses they own, and for future generations,” said Mr Jurkovich.
Kiwibank continued to make strong progress against its sustainability commitments in FY20.
Audited - $m |
Year ended 30/06/20 |
Year ended 30/06/19 |
---|---|---|
Financial performance |
||
Interest income |
894 |
933 |
Interest expense |
(439) |
(488) |
Net gains on financial instruments |
13 |
3 |
Net fee income |
85 |
90 |
Operating expenses |
(428) |
(375) |
Credit impariment (losses)/reversals |
(51) |
(12) |
Other impairment losses |
— | — |
Profit before taxation |
74 |
151 |
Income tax expense |
(17) |
(43) |
Net profit after taxation |
57 |
108 |
Download the General Disclosure Statement - June 2020 (PDF 2.4 MB)
Media enquiries contact: Kara Tait, Kiwibank External Communications Manager - 027 475 3521