SYDNEY: Australian banking giant Westpac announced a 38 percent rise in first half profits Wednesday, helped by lower impairment charges and improved earnings across the business.
The bank, Australia's second largest by market capitalisation, saw net profit rise to Aus$3.96 billion ($4.3 billion) for the six months to March 31, from Aus$2.88 billion the previous year.
Cash earnings, which strips out volatile items, increased seven percent to Aus$3.17 billion.
"This healthy result reflects building momentum across the business with strong financial disciplines," said chief executive Gail Kelly.
"All divisions delivered improved financial results, something we've not seen since before the global financial crisis.
Westpac, one of Australia's "big four" banks that dominate the sector, said the profit figure benefited from a one-off finalisation of tax consolidation, which was excluded from the cash earnings figure.
Impairment charges fell 47 percent from a year earlier to Aus$463 million -- about a quarter of the peak size of impairments in the second half of fiscal 2009.
Westpac said that the operating environment had remained broadly supportive, despite consumer and business caution and the impact of natural disasters.
Sentiment was likely to improve over the rest of 2011, given low unemployment in Australia, the bank added. As a result, business credit growth was likely to recover, although the timing of that remained uncertain.
"Key indicators were generally positive during the half with the economy generating good growth, low unemployment and moderate inflation," said Kelly.
"Despite this, both consumers and businesses remain relatively cautious and while confidence is expected to pick-up, lending growth is likely to be moderate in the immediate future."
The bank declared an interim fully franked dividend of 76 cents per share, up from 65 cents a year earlier.
Westpac shares finished down 62 cents, or 2.51 percent, at Aus$24.11 in a broad-based market sell-off.
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