The New Zealand branch of global banking giant HSBC recorded flat profit in the March quarter with reduced costs helping offset falling income and a smaller asset base.
HSBC’s latest General Short Form Disclosure Statement shows the bank’s Kiwi operations delivered unaudited profit after tax of NZ$13.36 million in the three months to March, slightly below the NZ$13.4 million recorded in the same period of last year.
Total operating income fell 8% to NZ$33.1 million from NZ$36.1 million but the bank trimmed operating expenses by 15% to NZ$12.9 million from NZ$15.2 million.
HSBC, along with state owned Kiwibank, was recently warned by the Commerce Commission after an investigation into mortgage break fees charged by banks when customers repay fixed-rate loans early. It also agreed to repay customers NZ$113,000.
HSBC’s total assets fell 20% to NZ$4.8 billion from NZ$6 billion a year ago and were down 2% since December 31.
Provisions for loan impairments fell 23% to NZ$12.4 million from NZ$16 million.
The bank’s residential mortgage book was down slightly to NZ$934.9 million at March 31 from NZ$957.7 million at December 31. Shortly after the end of the quarter HSBC launched its Premier rates for those borrowing more than NZ$500,000. These rates are as much as 100 basis points below others in the market. See all bank mortgage rates here.
Retail term deposits stood at NZ$1.48 billion, down 18% year-on-year from NZ$1.8 billion.
* This article was first published this morning in our paid subscriber email for bank executives, regulators and other industry experts. Subscribe here or email bernard.hickey@interest.co.nz
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