The National Australia Bank-owned Bank of New Zealand (BNZ) today reported its September year net profit rose 13 per cent to $683 million.
Underlying net profit, excluding discontinued operations, rose 15 per cent to $605m.
Earlier, NAB, Australia's top lender by assets, reported its annual profit rose 17.7
per cent to A$4.4 billion ($5.31 billion).
It posted a 19 per cent rise in second-half profit, close to market forecasts, driven by growth in loans and fund management.
BNZ said it had a strong performance across all business units.
A competitive marketplace saw net interest margins contract 12 basis points to 2.45 per cent.
The bank was able to cut its cost to income ratio by 3.5 per cent to 44.1 per cent.
It said lending volumes rose 12 per cent and deposits were up 9 per cent.
Chief executive Cameron Clyne said BNZ had streamlined its agribusiness operations and had increased market share to a 2007 high of 18.3 per cent.
Business banking saw continued growth in the more sophisticated lending product areas and by focusing on small and medium enterprises.
Mr Clyne said BNZ would continue to focus on a strategy of profitable volume growth.
"We won't be chasing market share at any cost," he said in reference to BNZ's controversial "unbeatable" mortgage advertising campaigns.
Profits for BNZ's Corporate and Institutional Bank saw underlying earnings rise 30 per cent year-on-year and revenues up 21 per cent to $265m.
NAB, which owns the UK's Yorkshire Bank and Clydesdale Bank, reported a cash profit of A$2.299 billion for the April-September period, up from A$1.93 billion a year ago.
NAB's profit marks the end of Australian commercial banks' fiscal 2007 profit reporting season, which largely fell short of market expectations.
NAB's rivals, Australia and New Zealand Banking Group Ltd, St George Bank Ltd and Bank of Queensland Ltd , all announced plans to raise capital to sustain growth as lenders' funding costs rise due to the global credit squeeze.
NAB shares are up 4.4 per cent so far this year, underperforming a 15 per cent rise in the benchmark S&P/ASX 200 index in the same period.
- NZPA
