BNZ grew its market share in mortgage lending, agribusiness and deposits in the three months to December but recorded a rise in overdue and impaired assets, its parent National Australia Bank (NAB) says.
In its first quarter trading update NAB says New Zealand's economic recovery remains fragile and system credit growth subdued. However, BNZ continued to deliver "consistent performance with a strong focus on deposit growth, repricing to reflect current market conditions and maintaining a strong cost discipline."
"During the quarter New Zealand Banking has grown its market share in mortgage lending, agribusiness and deposits," NAB said, without providing specific details.
Although BNZ's charge for bad and doubtful debts was slightly lower in the quarter, specific charges for certain large corporate exposures were made but NAB didn't detail these. Nonetheless, NAB said strong credit card collections and improvements in credit ratings helped "moderate" the overall charge for the period.
"The ratio of 90 days plus past due and gross impaired assets to gross loans and acceptances increased to 1.87% from 1.75% at September 30, 2010."
BNZ, which raised about A$1.4 billion in covered bond funding through a 1 billion euros issue last November, had improved earnings, NAB added.
Meanwhile, NAB reported an unaudited cash profit of A$1.3 billion for the three months to December 31 compared to the A$1.25 billion expected by analysts and A$1.1 billion in the same period of the previous year.