Its core earnings were also up 3 per cent on the second half of 2016, Westpac said.
“As with every period, the group seeks to achieve a balanced outcome across strength, return, productivity and growth,” the big four bank said.
“This half, given the low-growth environment, evolving liquidity requirements and limits on certain types of lending, the group focused more on enhancing returns and further strengthening the balance sheet while being targeted on loan growth.”
Westpac said the increase in cash earnings was the result of a 2 per cent increase in operating income, a $36 million increase in impairment charges and “little change” in its costs.
Its statutory net profit also grew 6 per cent to $3,907 million, which Westpac chief executive Brian Hartzer said it was a “solid result”.
“We have been disciplined in balancing growth and returns, with cash earnings up 3 per cent over both the previous half and the same period last year,” Mr Hartzer said.
“At 14 per cent, our return on equity is at the upper end of the range we are seeking to achieve, and we held costs flat over the last six months. We continue to strengthen our balance sheet, with our CET1 capital ratio now at 10 per cent and with customer deposit growth well above loan growth.”
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