ASB Bank Limited Analysis

Overview

ASB Bank provides a variety of financial services including retail, business and rural banking, funds management, insurance and investment and securities services. Opened in 1847 as the Auckland Savings Bank, it became a fully owned subsidiary of Commonwealth Bank of Australia in 2000.

Performance

The following information was extracted from ASB Bank Limited's full year results, released 14 August 2024:

ASB full year results: Profit down 10%

ASB today reported a cash net profit after tax (NPAT) of $1,364 million for the 12 months to 30 June 2024, a decrease of $149 million or 10% on the prior year. Statutory NPAT was $1,455m, a decrease of 7% on the prior year. Cash net interest margin (NIM) decreased 16 basis points from the prior year, resulting in cash operating income decreasing 5%. Home lending grew by 1% for the 12 months to 30 June 2024, during a period of low market growth. Business and rural lending also increased 1% for the 12 months to 30 June 2024. Total customer deposits grew by 5%.

Operating expenses increased 3%, reflecting the bank’s continued investment in customer experience initiatives, technology platforms and people, and further investments to prevent fraud and scams and enhance financial crime capability. ASB’s total regulatory capital, an important measure of a bank’s financial strength, increased by $0.5bn to $11.6bn. The total capital ratio was 16.3%, well above the 12.5% required by the Reserve Bank of New Zealand as at 30 June 2024.

ASB Chief Executive Vittoria Shortt says the result reflects the challenging economic conditions but also reinforces ASB’s strength to continue supporting its customers, communities and the broader economy.