ASB Bank has suffered a near 11 per cent fall in tax paid profit to $238 million for half year to December.
The drop from $267 includes $41 million in accounting losses due to the introduction of international financial reporting standards.
The bank says its underlying businesses continued to perform well, with total assets increasing by 16.3 per cent to $65.3 billion on a year earlier and total loans up 8.6 per cent to $52.5 billion.
Home loan balances grew 6.3 per cent, improving the bank's market share slightly to 23.4 per cent.
Demand for new lending stalled in the later months of last year. The result was boosted by strong treasury trading income.
But asset growth was offset by provisioning for impaired loans increasing to $157 million, representing 0.24 per cent of total assets, up from 0.18 per cent at June 30 last year.
Stiff competition and higher funding costs resulted in the net interest margin declining to a record low 1.5 per cent from 1.8 per cent.
"These record low margins are an indication of the challenging economic environment for New Zealand banks, which has seen higher wholesale funding costs and ongoing demand for competitively priced retail deposits," ASB says.
Meanwhile, ASB parent Commonwealth Bank of Australia's half-yearly cash profit was down 16 percent, in line with a market update it issued only last week and was dented by a global crisis that slowed credit growth and sent bad debts soaring.
CBA kept its interim dividend unchanged at A$1.13 (NZ$1.43), the first time in 16 years it has not raised the half-year payout, and warned over future dividends in a comment likely to worry many shareholders who buy the stock because of its income.
"In the current uncertain economic environment we cannot guarantee to maintain future dividends at past levels," Chairman John Schubert said in the results statement
The drop from $267 includes $41 million in accounting losses due to the introduction of international financial reporting standards.
The bank says its underlying businesses continued to perform well, with total assets increasing by 16.3 per cent to $65.3 billion on a year earlier and total loans up 8.6 per cent to $52.5 billion.
Home loan balances grew 6.3 per cent, improving the bank's market share slightly to 23.4 per cent.
Demand for new lending stalled in the later months of last year. The result was boosted by strong treasury trading income.
But asset growth was offset by provisioning for impaired loans increasing to $157 million, representing 0.24 per cent of total assets, up from 0.18 per cent at June 30 last year.
Stiff competition and higher funding costs resulted in the net interest margin declining to a record low 1.5 per cent from 1.8 per cent.
"These record low margins are an indication of the challenging economic environment for New Zealand banks, which has seen higher wholesale funding costs and ongoing demand for competitively priced retail deposits," ASB says.
Meanwhile, ASB parent Commonwealth Bank of Australia's half-yearly cash profit was down 16 percent, in line with a market update it issued only last week and was dented by a global crisis that slowed credit growth and sent bad debts soaring.
CBA kept its interim dividend unchanged at A$1.13 (NZ$1.43), the first time in 16 years it has not raised the half-year payout, and warned over future dividends in a comment likely to worry many shareholders who buy the stock because of its income.
"In the current uncertain economic environment we cannot guarantee to maintain future dividends at past levels," Chairman John Schubert said in the results statement
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