Losing interest: The declining cash rate has caused industry revenue to decline

IBISWorld’s Banking in New Zealand market research report is a comprehensive guide to market size and growth prospects. Our industry reports offer strategic industry analysis of the factors influencing companies, including new product developments, economic, lifestyle and demographic influences, distribution and supply chain factors and pricing issues. Full analysis accompanies our data forecasts to illustrate how the market responds to emerging industry trends.


Industry Threats & Opportunities

  • Rising house prices have increased the value of mortgages issued by banks

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    Industry Analysis & Industry Trends

    The Banking industry has declined slightly over the past five years due to an overall drop in the cash rate. However, the rapid rise in residential housing prices and a strong property market over the same period have boosted the value of industry assets and propped up the industry. Concerns surrounding an overheated residential property market have been slightly tempered with the Reserve Bank of New Zealand introducing loan-to-value ratio (LVR) restrictions on mortgage lending. Overall, industry revenue is expected to decline at an annualised 0.1% over the five years through 2017-18.

    Fluctuations in the cash rate have been a key determinant of the industry's performance over the past five years...

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    Industry Report - Industry Products Chapter

    Industry players generate the majority of their revenue from lending activities. Home loans represent the largest market for New Zealand's banks, while lending to businesses, personal loans and unsecured loans are also another lucrative market. Banks also receive fees and commission for providing core banking services, such as opening and maintaining transaction accounts, term deposits and overdraft facilities. However, these services' contribution to revenue are small compared with lending. The industry's products and services are segmented based on their contribution to revenue.

    Housing loans

    Interest, fees and commissions earned from housing loans are expected to account for 52.1% of industry revenue in 2017-18. The..

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    Additional Insights for the Banking Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Banking Industry are

  • Access to the latest available and most efficient technologies
  • Superior financial management and debt management
  • Having a good reputation
  • IBISWorld analysts also discuss how external factors such as Cash rate and Residential housing loan rates in the Banking industry impact industry performance..

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    New Zealand Special Report

    Industry Products

    What is the Banking in New Zealand Industry?

    Industry enterprises primarily operate banks. Industry activities include accepting deposits and issuing consumer and commercial loans.

    Industry Products
    Housing loans
    Business, personal and credit card loans
    Core banking services
    Industry Activities
    Development bank operations
    Savings bank operations
    Trading bank operations

    Table of Contents

    About this Industry
    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry at a Glance
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Industry Performance
    Executive Summary
    Key External Drivers
  • Cash rate
  • Residential housing loan rates
  • Residential housing prices
  • Total capital expenditure

  • Current Performance
  • Industry structure
  • Funding costs
  • Housing market
  • Dairy sector
  • Chart: Revenue Growth

  • Industry Outlook
  • Residential housing
  • Regulation
  • Technology
  • Table: Banking Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Banking Industry Lifecycle vs The Economy

  • Products & Markets
    Supply Chains
    Key Buying Industries
  • Construction in New Zealand
  • Agribusiness in New Zealand

  • Key Selling Industries
  • Accounting Services in New Zealand
  • Legal Services in New Zealand

  • Products & Services
  • Housing loans
  • Business, personal and credit card loans
  • Core banking services
  • Chart: Banking Industry Products and Services Segmentation

  • Demand Determinants
  • Business activity and economic conditions
  • Residential mortgages

  • Major Markets
  • Consumers
  • Finance and insurance firms
  • Other businesses
  • Professional services and property firms
  • Government
  • Chart: Major Market Segmentation for the Banking Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Competitive Landscape
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Profit
  • Interest expenses
  • Wages
  • Bad debts
  • Other
  • Chart: Cost Structure Benchmarking – Sector vs Banking

  • Basis of Competition
  • Internal competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Banking Industry

  • Industry Globalization
    Major Companies
    ANZ Bank New Zealand LimitedWestpac New Zealand Group LimitedASB Holdings LimitedBank of New Zealand
  • Table: ANZ Bank New Zealand Limited - financial performance
  • Table: Westpac New Zealand Group Limited - financial performance
  • Table: ASB Holdings Limited - financial performance
  • Table: Bank of New Zealand - financial performance

  • Operating Conditions
    Capital Intensity
  • Chart: Level of Capital Intensity for the Banking Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Key Statistics
    Table: Industry Data for the Banking Industry
  • Industry Revenue (2009-2023)
  • Industry Gross Product (2009-2023)
  • Establishments (2009-2023)
  • Businesses (2009-2023)
  • Employment (2009-2023)
  • Wages (2009-2023)
  • Total Assets (2009-2023)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Jargon & Glossary
    Cash Rate
  • The interest rate charged on overnight borrowings between banks that is set the Reserve Bank.
  • Net Interest Spread
  • The difference between the borrowing and lending rates of a bank.
  • Tier-One Capital
  • Used to measure the financial strength of a bank, this type of capital is generally limited to common shares and retained earnings.
  • Why buy this report?

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
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    This report on Banking in New Zealand:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Banking in New Zealand market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Banking in New Zealand, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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