Westpac NZ profit rebounds; CEO to retire

Westpac New Zealand recorded a 98% profit increase in the six months to March and has announced the imminent retirement of its chief executive, David McLean.

The lender made a $583 million cash profit in the six months to March, it announced today.

The big four bank, which could be sold by its Australian parent group pending a strategic review, attributed its turnaround in fortunes to the strong economic recovery. 

Home loans grew by 10% year-on-year, the bank said, while customer deposits rose by 7%. The lender's net interest margin remained at 2.06%. 

Westpac was boosted by a net impairment benefit of $99 million, compared to last year's impairment charge of $211 million in the six months to March 2020.

Chief executive David McLean said the Government's successful Covid strategy had helped the lender increase profits.

"Thankfully, New Zealand has so far avoided the worst effects of the global pandemic, largely thanks to decisive leadership from the Government, and we are now cautiously optimistic.

"Westpac NZ’s balance sheet is sound and we’re well-positioned to support the economic recovery and the needs of households and businesses."

Westpac also announced that McLean would retire from his position on June 25. The CEO has been in the role since 2014. 

McLean's departure comes as Westpac Group in Australia performs a sweeping strategic review of its NZ operations. 

The group is considering a sale, spinoff, or partial sale of the Kiwi business due to forthcoming changes around bank capital requirements, which will force the big four to put more capital aside.

Analysts say Westpac NZ could be worth $10 billion to $15 billion. 

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