By 1News Reporters
10:58am

Westpac has posted a $545 million half-year profit for the six months to the end of March.


The bank said it was a 19% fall compared with the previous six months, but a
4% increase compared with the same period last year.


Pre-provision profit was $795 million, up 4% on the same period last year.


A Westpac spokesperson said higher impairment provisions "in the face of worsening economic conditions" and margin compression "as the bank responded
to official cash rate reductions", were behind the drop.


The bank's net-interest margin as of March 31 was 2.29%, up from the same period last year but down 0.10% from the last six months. Its net impairment was $37 million, compared with $33 million the previous year.


Westpac's home lending was up 5% to $73.3 billion, its business lending was
up 6% to $35 billion, and deposits were up 4% to $83.7 billion.


Yesterday, BNZ posted a $494 million statutory net profit for the half-year.
On Friday, ANZ New Zealand posted a half-year cash net profit of $1.238 billion.


Westpac CEO Catherine McGrath said that before war broke out in the Middle
East in February, New Zealand's economy had been "slowly gathering momentum".


"While the conflict is set to push GDP growth backwards in the near term, we think the economy will pick up again when there is a resolution to the
conflict and oil prices then gradually ease," McGrath said.


Last month, Westpac, joined by other major banks, increased its home loan
rates following the Reserve Bank's decision to hold the Official Cash Rate steady at 2.25%.


Today, the bank said its economists expected the OCR to be 0.25% higher in September, October and December, and predicted it would sit at 3% by the end
of the year.


They also expected gross domestic product (GDP) to shrink by 0.4% in the June quarter.


The Westpac economists expected unemployment and inflation to peak at 5.6%
and 4.5%, respectively, in the "middle part" of this year.

McGrath said the bank was "well placed" to help customers navigate challenges and capitalise on what it believed would be "better economic conditions later this year and next".

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