Big NZ banks experience soaring profits

Earnings of ANZ, ASB, BNZ, Westpac and Kiwibank for the last six months of 2011 rose by 25 percent to $2.8 billion.

The profit boost, up from $2.3 billion for the previous six months, was driven by more income from interest, growth in other income and reduced expenses says PwC analyst Sam Shuttleworth.

"The rain clouds over Europe caused by the Eurozone debt crisis is the biggest concern facing our major New Zealand banks at  this time, but the New Zealand banking sector feels well prepared," says Mr Shuttleworth.

However, expenses from bad debts were also up by $24 million.

Considering the impact the Christchurch earthquake would have had on bad debt expenses in 2011, Shuttleworth still finds this remarkable. Bad debt for 2011 was down by $400 million on 2010 levels.

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