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Illustration of Westpac profit up 10%, bad debts fall

Westpac Sees 10% Profit Surge Amid Economic Recovery Efforts

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Westpac Bank has reported a 10% increase in its full-year profit, bouncing back from a decline in the previous year. This growth is attributed to an uptick in lending, improved margins, and a significant reduction in bad debts. The Australian bank’s performance reflects a stabilization in lending as interest rates began to decline.

Catherine McGrath, CEO of Westpac NZ, shared that the bank has focused on aiding customers in navigating through tough economic times and is now positioned to support their growth as the economy starts to recover. Mortgage lending rose by 3%, while business lending increased by 2%. The bank also noted that provisions for bad debts were dramatically lower, at just 20% of the previous year’s amount.

McGrath highlighted that the second half of the year saw business lending significantly exceeding system growth, with a 65% increase in direct interactions with business clients to better comprehend their needs. Additionally, she mentioned that many fixed-rate home borrowers would benefit from reduced rates by the end of the year, leading to substantial savings.

While there has been a rise in reported fraud cases by 12%, the bank successfully prevented, recovered, or refunded $9 of every $10 lost to scams. McGrath emphasized the importance of collaboration with technology and social media companies to improve detection and prevention of fraudulent activities.

Westpac is also committed to enhancing its lending towards community and affordable housing, sustainable agricultural practices, and solar energy initiatives. Looking ahead, McGrath anticipates a gradual economic recovery in the coming year, driven by falling inflation and interest rates, though challenges remain such as rising unemployment and geopolitical tensions.

Overall, the outlook shows promise as confidence begins to rebuild, which could lead to a more robust economic environment moving forward.

This positive spin reflects Westpac’s proactive measures to support customers and the community, indicating a hopeful future for both the bank and its stakeholders as the economy stabilizes.


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