The government's Kiwibank continues to grow apace with profitability lifting sharply in the December quarter while its share of the mortgage market continues to grow.
In fact, so fast is its growth, the bank says it again needs fresh capital. To date, its parent company, New Zealand Post, has plowed in $200 million. But now Kiwibank is to go to the private sector, aiming to raise $75 million from an unsecured subordinated bond issue which will qualify as Tier 11 captial under the Reserve Bank guidelines.
Kiwibank had $204.95 million in capital at December 31, all Tier 1, representing 10.3% of total risk-weighted exposures. The minimum capital requirement is 8% of exposures.
Kiwibank's net profit in the three months ended December jumped 89.5% to $6.08 million compared with the $3.21 million result in the same quarter of 2005 and compared with $5.3 million in the September quarter.
The bank's mortgage book grew $250 million to $2.98 billion in the three months ended December. Using Reserve Bank figures as a proxy for the mortgage market, that puts its market share at 2.3%
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