The latest data from APRA has revealed that net profits of Australia’s authorised deposit-taking institutions have fallen over the past 12 months.
APRA has released the quarterly Authorised Deposit-taking Institution Performance data for the March 2019 quarter, revealing a dip in profits.
Net profits after tax for March 2019 were $34.7 billion, which is a decline of 4.7 per cent from the March 2018 quarter.
It is also a quarter-on-quarter decline of $1 billion, as in the December 2018 quarter ADIs reported $35.7 billion in profit.
The statistics are not a surprise to the industry, with a less than enthusiastic decline in profits reported by the banks in half-year results.
CBA reported a 6 per cent decline in net profits in its half-year profits while Westpac reported a fall of 24 per cent in the half-year.
ANZ also reported a decline in net profits with a 5 per cent slide, with NAB being the only one of the big four to report a rise in net profits of 4.3 per cent.
Total assets, though, continue to rise, with a 3.4 per cent increase from $4.667 billion in the March 2018 quarter to $4.824.8 billion this quarter.
Other key statistics continued to rise including a 1.4 per cent rise in total capital base and a 0.7 of a percentage point rise in total risk-weighted assets.
It also showed an improvement in the number of housing loans for ADIs with greater than $1 billion in loans, with a 1.2 per cent increase in the number of loans over the quarter.
A downturn in house prices in Sydney and Melbourne had also affected the new housing loans approved in the quarter, with a 16.5 per cent decline.
ADIs reported $86.8 billion in the first quarter of 2018 but only $72.4 billion in the past quarter, which is no doubt a knock-on effect of the downturn.
The statistics also revealed that ADIs had increased their exposure to commercial property by 4.6 per cent from the first quarter of 2018.
Eliot Hastie is a journalist at Momentum Media, writing primarily for its wealth and financial services platforms.
Eliot joined the team in 2018 having previously written on Real Estate Business with Momentum Media as well.
Eliot graduated from the University of Westminster, UK with a Bachelor of Arts (Journalism).
You can email him on: el[email protected]
Challenger recorded a slight incline in total assets under management to $84 billion in the first quarter of financial year 2020, up 3 per c...
Aussie investors might be missing billion-dollar EMD opportunities on their doorstep, but are the risks greater than the rewards? ...
When defensive equity positions become more appealing, stocks that exhibit lower risk attributes, including low beta stocks and stocks in tr...