Bank of New Zealand Analysis

Overview

BNZ was incorporated on July 29, 1861 and its ultimate parent bank is National Australia Bank Limited. The businesses and affairs of BNZ and all of its wholly owned entities (the Banking Group) are managed by, or under the direction or supervision of, the BNZ Board of Directors and the BNZ Chief Executive Officer in compliance with the requirements and regulations of the Banking Group's primary regulator, the RBNZ. BNZ is a registered bank under the Reserve Bank of New Zealand Act 1989.

The Banking Group is one of New Zealand's largest banking organizations and provides a broad range of banking and financial products and services to retail, business, agribusiness, corporate and institutional clients. The Banking Group is organised into three major operating and reportable segments: Private, Wealth & Insurance, Corporate & Institutional Banking and BNZ Partnership Banking. These segments are supported by the specialist units of Customer, Product and Services, Corporate Affairs, Finance, People, Risk, Technology and Operations, and Transformation and Strategy.

Performance

The following information was extracted from the Bank of New Zealand's full year results, released 7 November 2024:

Bank of New Zealand (BNZ) today announced a statutory net profit of $1,506 million for the 12 months to 30 September 2024, down $3 million or 0.2% which is broadly flat on the prior financial

year.

This was driven by lending and deposit growth partially offset by lower net interest margins, higher operating expenses and includes the impact of the sale of BNZ’s wealth business.

BNZ CEO Dan Huggins says this is a solid result in challenging conditions, which reflects BNZ’s continued growth as more New Zealanders choose to bank with BNZ.

BNZ’s total lending increased $4.3 billion or 4.2%, with business lending up $2.0 billion or 4.6% and home lending up $2.4 billion or 4.1%. Total customer deposits increased by $3.8 billion or 4.8%.

Mr Huggins says BNZ continues to support its customers through one of the most difficult economic cycles in recent history.

“With inflation back within the Reserve Bank’s target band and as interest rates begin to fall, this will be welcome news for many households and businesses.

“However, there is always a lag between changes in monetary policy and its impact on the economy, and it will take some time for the benefits to flow through. For customers feeling under pressure our message is get in touch,” says Mr Huggins