Bank’s profit trumps biggest Kiwi firms

New Zealand’s biggest bank made more money than Fonterra, Spark, Fletcher Building, the Warehouse, Air New Zealand and the major supermarkets combined last year and it’s not good enough, according to activist investor Sam Stubbs.

ANZ New Zealand announced a record net profit of $1.98 billion yesterday, while its parent company Australia and New Zealand bank made A$6.4b.

But Stubbs, founder and managing director of KiwiSaver provider Simplicity, and a critic of the banks, said ANZ was taking advantage of its dominant position to extract unreasonable profits.

“The ANZ profit is classic rentseeking behaviour.”

Stubbs said the bank, the largest in New Zealand, was just one company yet its profit was more than eight of New Zealand’s biggest names and almost twice that of the top seven power companies combined.

New Zealand’s largest company by revenue, dairy co-operative Fonterra, made $745 million last year while telco Spark had a profit of $418m.

Air New Zealand made $382m and

Fletcher Building $105m.

Woolworths, which owns the Countdown supermarket chain made $155.9m, and Foodstuffs North Island and South Island, parent of Pak’nSave and New World, had a combined net profit of $25.8m. The Warehouse Group made $20.7m.

Stubbs said ANZ made $416 of profit for every man, woman and child in New Zealand yet it was shutting down branches and reducing staff. Figures from its financial report show the bank reduced its New Zealand headcount by 207 fulltime equivalent staff this year to 6165.

In September, the bank received criticism from Martinborough residents and businesses for plans to shut its branch. That didn’t stop the bank from closing up shop on October 19. That followed branches in Wairoa in the Hawke’s Bay and Wainuiomata near Wellington this year.

Stubbs said New Zealanders should vote with their feet and pay more attention to the costs and fees they were paying the banks.

“Everyone wants to have healthy and profitable banks. But New Zealanders are being taken advantage of.”

In releasing its result, ANZ pointed out its contribution to New Zealand. In the year to September 30, it paid $760m in corporate tax, which it says is more than 5 per cent of New Zealand’s corporate tax take.

It also paid $810m in staff wages and salaries and $540m to local contractors and suppliers, while $15m was made in sponsorship and charitable donations.