Press Release – New Zealand Bankers’ Association
The New Zealand Bankers’ Association today released long run bank profitability data which compares returns on equity for New Zealand banks against NZX listed companies. Banking industry profits in the middle of the pack
The New Zealand Bankers’ Association today released long run bank profitability data which compares returns on equity for New Zealand banks against NZX listed companies.
Independent analysis undertaken by Massey University showed that retail banks’ average return on equity over the last five years fell in the middle of the range compared to NZX listed companies with a minimum market capitalisation of $100 million over the same period.
A comparison of return on equity over the last five years is set out in this table:
Click for big version.
Return on Equity: New Zealand banks compared to NZX companies
Five year (2008-2012) return on equity average for individual NZX companies (with a minimum market capitalisation of $100 million) and retail banks (shown in red) [The analysis does not include The Co-operative Bank as it became a registered bank in 2011. ] in descending order of performance.
“We wanted some analysis which put bank profitability in the context of other New Zealand businesses because there are a lot of views on bank profitability which we felt were overstated,” said New Zealand Bankers’ Association chief executive Kirk Hope.
Average bank returns on equity from 2008 to 2012 ranged from 7.5% to 16.3%, well below the top average return on equity of 31.7%.
“This analysis shows that banks fall in the middle of the range of profits compared to NZX listed businesses,” said Hope.
|Company||Code||5 Year ROE %|
|RESTAURANT BRANDS NEW ZEALAND LTD||RBD||31.7%|
|HALLENSTEIN GLASSON HOLDINGS LTD||HLG||28.5%|
|TELECOM CORP OF NEW ZEALAND LTD||TEL||26.8%|
|MICHAEL HILL INTERNATIONAL LTD||MHI||25.8%|
|THE WAREHOUSE GROUP LTD||WHS||25.6%|
|NEW ZEALAND EXCHANGE LTD||NZX||24.4%|
|OPUS INTERNATIONAL CONSULTANTS LTD||OIC||23.2%|
|FISHER & PAYKEL HEALTHCARE CORPORATION||FPH||21.6%|
|RYMAN HEALTHCARE LTD||RYM||17.8%|
|SKELLERUP HOLDINGS LTD||SKL||16.8%|
|SKY CITY ENTERTAINMENT GROUP LTD||SKC||14.5%|
|DELEGAT’S GROUP LTD||DGL||14.3%|
|CAVALIER CORPORATION LTD||CAV||13.4%|
|EBOS GROUP LTD||EBO||13.1%|
|STEEL & TUBE HOLDINGS LTD||STU||11.4%|
|NUPLEX INDUSTRIES LTD||NPX||10.5%|
|NEW ZEALAND REFINING COMPANY LTD (THE)||NZR||10.3%|
|SKY NETWORK TELEVISION LTD||SKT||8.6%|
|ANZ BANK||ANZ||8.5% [Includes goodwill paid. ]|
|HELLABY HOLDINGS LTD||HBY||8.1%|
|PORT OF TAURANGA LTD||POT||7.5%|
|FLETCHER BUILDING LTD||FBU||7.5%|
|AIR NEW ZEALAND LTD||AIR||6.0%|
|CONTACT ENERGY LTD||CEN||5.6%|
|COLONIAL MOTOR COMPANY LTD||CMO||5.0%|
|AUCKLAND INTERNATIONAL AIRPORT LTD||AIA||3.9%|
|NEW ZEALAND OIL & GAS LTD||NZO||3.2%|
|VITAL HEALTHCARE PROPERTY TRUST||VHP||2.8%|
|GOODMAN PROPERTY TRUST||GMT||1.7%|
|PROPERTY FOR INDUSTRY LTD||PFI||0.1%|
|PGG WRIGHTSON LTD||PGW||0.1%|
|GOODMAN FIELDER LTD||GFF||-0.3%|
|KIWI INCOME PROPERTY TRUST||KIP||-0.7%|
|GUINNESS PEAT GROUP PLC||GPG||-0.7%|
|ARGOSY PROPERTY LIMITED||ARG||-1.1%|
|FISHER & PAYKEL APPLIANCES HOLDINGS LTD||FPA||-2.8%|
|PRECINCT PROPERTIES NEW ZEALAND LTD||PCT||-4.3%|
|NATIONAL PROPERTY TRUST||NPT||-6.5%|
|PUMPKIN PATCH LTD||PPL||-13.8%|