KPMG’s Financial Institutions Performance Survey (FIPS) Review of 2015 shows that New Zealand’s banking sector – underpinned by a strong economy – delivered outstanding performance.
KPMG’s Financial Institutions Performance Survey (FIPS) - Review of 2015 shows that New Zealand’s banking sector – underpinned by a strong economy – delivered outstanding performance in 2015.
Results from 2015 are being described as ‘all positive’ for New Zealand banks. As well as reaching an all-time high of $5.17 billion in net profit, the sector improved several metrics across the board.
The Banks have strengthened their position in the face of global volatility and further domestic regulation. In fact, the new LVR limits and tax rules have resulted in better quality loan books – with the proportion of loans over the 80% bracket declining from 15.72% to 13.17% throughout 2015 for the five major banks.
The real challenge, however, will be to maintain this momentum in 2016. The future brings some uncertainty; with global volatility, ongoing concern around low dairy prices, and the continued threat of a sharp housing price correction. The Survey also shows banking executives are concerned about the potential impact of the Reserve Bank’s proposed rules on outsourcing.
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