WBC, ANZ- 2 banking stocks to focus as NZ banks amass profits in 2021

Highlights

• New Zealand’s banks garnered profits worth over NZ$6 billion, despite battling the COVID-19 pandemic.
• Westpac Banking sells its NZ life insurance business for NZ$400 million.
• Australia and New Zealand Banking Group to integrate its Digital Division and its Australian retail business.

Despite being impacted by the ongoing pandemic, NZ banks have witnessed solid growth, bolstered by record house prices and a home loan boom, cites KPMG.

According to reports, Kiwi banks’ net profits jumped by almost 48% last year and touched NZ$6.13 billion.

Further, the banks’ net interest income and non-interest income climbed by 7.07% and 5.94%, respectively.

However, experts attribute the said performance to the Government's financial support measures for helping the country battle COVID-19 impacts and, secondly, the availability of cheap funding for housing.

As a result, many Kiwis were allured by investing in the property sector at a time when spending was limited in other avenues.

That said, let us take a glance at the two well-known NZX-listed banks that can be considered.

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Westpac Banking Corporation (NZX:WBC; ASX:WBC)

Westpac Banking Corporation, one of the most prominent banks across Australasia, has recently revealed the sale of its New Zealand life insurance business, Westpac Life-NZ- Limited, for simplifying its business operations.

Related Read: WBC, ANZ, GEN- 3 NZX financial stocks on investors’ watchlist

The sale worth NZ$400 million has been made to Fidelity Life Assurance Company Limited, and the gain on the said sale will be captured in WBC's HY22 results.

At the closing bell on 9 March, WBC rose by 1.24% at NZ$23.650.

Australia and New Zealand Banking Group Limited (NZX:ANZ; ASX:ANZ)

Australia and New Zealand Banking Group Limited is another major bank operating in the Kiwi nation. A few days back, the group disclosed combining its Digital Division with its Australian retail business.

Also Read: ANZ,HGH &WBC: 3 NZX banking stocks as interest rates set to soar

Further, Maile Carnegie will take charge as Group Executive, Australian Retail, and will focus on evolving the bank’s retail business.

Moreover, ANZ will also segregate its Australia-based commercial businesses into a new division considering future growth opportunities.

At the closing bell on 9 March, ANZ gained by 0.60% at NZ$26.950.

Bottom Line

The banking sector forms the lifeline of an economy and pushes economic growth and the progression of the nation.