Kiwibank posts $103m six-month profit as debt-averse households pay down home loans
Thursday, 26 February 2026
Kiwibank’s announced an after-tax profit of $103 million for the six months to the end of December, amid what the bank’s chief executive Steve Jurkovich calls some “slightly encouraging signs” of economic improvement.
“I wouldn't put it much more than that. I think it's going to take all of, all of 2026 for us to feel like we're in a position where the Reserve Bank’s going to have to do something about rates.
“I wouldn't be surprised if we didn't see a rate increase at all this year,” he said.
Jurkovich was speaking after the announcement that its latest profit had risen 12% from a year earlier, albeit on slightly narrower margins as competition for deposits had been fierce.
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During the six months, Kiwibank increased its lending by $1.8 billion to $37.6b with its residential home loans growing 1.6 times faster than the market, increasing $1.3b.
In the six months to last December, Kiwibank accounted for 13% of all net new bank mortgage lending growth, Jurkovich said.
But it had been a tough time for many households, and many had grown debt-averse, and were focused on paying down their debts.
Over the past two years, Kiwibank customers have been repaying equity in their home loans around a third faster than the market average, Jurkovich said.
Business lending increased $0.4b to $8.7b. Kiwibank had a growing presence in the small and medium-sized business market of companies with annual turnover of $5m to $20m.
“I'm really heartened by our growth in the heartland commercial market,” he said.
Banks are keen to send messages to MPs, who have taken on a role in trying to drive greater competition and transparency in banking.
Parliament’s Finance and Expenditure Select Committee has been conducting ongoing hearings into banking, including summoning bank chief executives, including Jurkovich to give evidence.
The interest was originally prompted by MPs on the Primary Production Select Committee, and throughout MPs from all parties have largely agreed on the need for a better banking deal for the public.
They have wanted to see the cost of banking fall, and Kiwibank said in its results announcement that is had removed 12 everyday banking fees, including the Visa Debit Card annual account fee, overseas ATM withdrawal fees, and card replacement fees.
MPs have also been concerned about access to bank branches, especially in rural areas.
Kiwibank said it had New Zealand’s largest physical banking network, providing face-to-face access for customers and communities across the country.
On Wednesday, the Reserve Bank unveiled proposals to force the banking sector to grow access to cash services for the public, which could see the industry have to spend up to $104m each year ensuring there are smart ATM centres or multi-bank hubs in rural towns.
However, bank chief executives have also used it as a way of directly lobbying MPs for changes they want to see.
Jurkovich successfully argued for changes to bank capital requirements by the Reserve Bank, which favoured the big four Australian banks, and penalised smaller challenger banks like Kiwibank.
Changes followed which have freed up Kiwibank to do more lending without having to hold more capital: as much as $7b of business lending, or $20b home loan lending.
But there’s more the bank wants. When Jurkovich appeared last week before the committee, he asked MPs to seek change to the levies charged on the Depositor Guarantee Scheme.
It operates like an insurance company for deposits, so if a bank or other regulated deposit-taker falls over, the first $100,000 a person has saved with a deposit- guaranteed, with the scheme backed by the taxpayer.
When Jurkovich appeared before the select committee last week, he complained that the pricing of the levies was unfair on smaller banks like Kiwibank, and asked for that to change.
Jurkovich felt MPs had been doing a good job, and he had seen little point-scoring between parties during the hearings.
It was pleasing to see MPs trying to drive change in banking, focused on increasing competition, driving open banking innovation, and tackling scams.
“That's quite a contrast to what I’ve seen,” Jurovich said.
“I’ve been on the job nearly eight years. When I think about what didn’t happen in those first six years, compared to what's been happening in the last two in those hearings, and how much more they're informed about open banking.”
Despite the general election at the end of the year being a “big unknown”, Jurkovich was hopeful that MPs driving change in banking would continue.
“I think the main things that they are focused on probably work well on both sides of the aisle,” he said.
Jurkovich said Kiwibank had made further progress on its multi-year transformation, including key upgrades to its digital banking and payments platforms, improvements to fraud and scam protections, and continued development of its new core banking platform.