The Bank of New Zealand is to have a female chief executive for the first time from January.

Current BNZ chief executive Anthony Healy has been promoted to chief customer officer - business and private banking and will return to Australia.

Angela Mentis, currently chief customer officer - business and private banking, at parent company National Australia Bank, will step up to become managing director and CEO of the BNZ.

It is the first time the BNZ has had a woman CEO, although other banks have already female leaders.

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Ann Sherry was previously head of Westpac and ASB's CEO is Barbara Chapman, who will step down from the top job next year.

Mentis has been on the board of the BNZ since December 2016 and part of NAB's executive leadership team since 2014.

NAB chief executive Andrew Thorburn, said leading the BNZ would be an exciting opportunity for Mentis.

"Having served as a director of BNZ since December 2016, Angela knows the bank and its strategy well and her relentless customer focus will ensure BNZ remains focused
on delivering for customers, shareholders and employees."

The executive shake-up comes as the bank reports its annual result for the year to September 30.

The BNZ's net profit grew 2.6 per cent to $937 million on the back of strong lending growth and lower provisions for bad and doubtful debts.

Its cash profit rose 7.9 per cent to $983m.

Anthony Healy, BNZ chief executive, said: "Our continued focus on our priority segments has delivered further market share growth in our core business and home lending segments, supporting New Zealand businesses and communities to grow and families to invest in homes."

Healy said ongoing growth and investment in its partners or business segment of the bank was a key driver of its performance in 2017.

"Our unique partners model continues to resonate strongly with our business and agri clients across New Zealand."

Charges for bad and doubtful debts decreased by $54m or 43.2 per cent as a result of improved economic conditions, including the outlook for the dairy portfolio.

Healy said it had been pleasing to see the recovery of the dairy sector which has delivered improving on-farm cash flows.

"We are also seeing the unwinding of the Dairy Impaired No Loss category, which has reduced 73 per cent over financial year 2017, from $823m to $222m.

"This is the result of the effort we made to support our farmers through the downturn and shows the resilience of the sector," he said.

Net interest income at the bank grew by $85m or 5.3 per cent driven by growth in lending and deposit volumes but that was partly offset by a lower net interest margin.

Its net interest margin shrank by 6 basis points to 2.18 per cent on the back of a competitive deposit market.

Gross loans and advances increased by $5 billion or 6.7 per cent to $79.1b driven by housing and business lending. Deposits increased by $4.6b or 9.1 per cent to $55.1b.

BNZ's parent NAB saw a 2.5 per cent rise in its cash earnings to A$6.6b. The bank made a statutory net profit of A$5.3b for the year to September 30.

Andrew Thorburn, NAB chief executive, said the result represented another year of consistent delivery for the bank.

"Cash earnings and revenue are up, asset quality is a highlight again, and we have further strengthened our balance sheet."

Thorburn said the bank had made strong progress in the past three years and it was now going to accelerate its strategy by increasing its investment by A$1.5b by September 2020 to further improve the experience for its customers, reshape its workforce and grow the bank.

At the same time it would target more than A$1b in savings as its simplified the business.

"We have a clear plan to deliver for our customers. We move forward with confidence and
a purpose to 'back the bold who move Australia forward'."

Australian media reported Thorburn saying that part of the savings would include a cut in 6000 jobs over the next three years, although a further 2000 new jobs would also be created.

NAB employed 33,422 full-time equivalent staff at September 30.

A BNZ spokeswoman it didn't have a specific number of planned job cuts.

"For us it is more of an ongoing transformation."

Last month BNZ restructured staff mainly in its head office with up to 100 people thought to be affected.

The bank employs 4500 permanent full-time staff and 760 permanent part-time staff.