MENU

Big four banks ready to report

The big four banks will this week begin announcing profits with the ANZ (ASX: ANZ) the first to report on Tuesday.

According to the Financial Review, Australia’s big four are likely to notch up profits of more than $13 billion as a result of cost-cutting and withholding interest rate cuts late last year.

Despite ANZ’s ‘Super-Regional strategy’ pushing into parts of Asia in search of profits, the company still generates more profit for every dollar lent to domestic customers while the National Australia Bank’s (ASX: NAB) margins are the thinnest.

NAB’s aggressive low-interest home loans have sought to set it apart from rivals by bringing Australians over from the other three banks and generating more revenue. However, it hopes the profits released next Thursday will close the gap on its competitors.

Business Day reported that NAB, ANZ and Westpac (ASX: WBC) will be looking to report more than $9 billion profit in coming weeks. Domestic market lending will be the centre of attention after Commonwealth Bank’s (ASX: CBA) retail bank underpinned first-half earnings of $3.78 billion.

Of the 50 basis points in rate cuts late last year, NAB and Westpac passed on 40 and 38 to customers respectively, which will be sure to increase their cash earnings. Westpac’s first-half earnings are expected to reach $3.38 billion. In order to remain financially competitive, the NAB has been slowly increasing its home loan interest rates, closing the savings gap with other banks despite ‘breaking up’ with them in 2011.

Foolish takeaway

The big four look set to report staggering profits from domestic revenues, but ANZ’s regional strategy could either put pressure on its suspected $3.13 billion in Australian revenue or help it to increase the overall performance of the bank. Conversely, CBA and Westpac will be focusing on domestic earnings from their home loans and consumer banks.

Savvy investors are now seeking growth in smaller companies. Discover two stellar small-cap opportunities now, in our brand-new research report, “2 Small Cap Superstars” — simply click here to download your FREE copy.

More reading

The Motley Fool’s purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool’s free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. Motley Fool contributor Owen Raszkiewicz own shares ANZ of the above mentioned companies.

The 5 mining stocks we’re recommending in 2019…

For decades, Australian mining companies have minted money for individual investors like you and me. But if you believe the pundits and talking heads on TV, those days are long gone. Finito! Behind us forever…

We say nothing could be further from the truth. To earn the really massive returns, you’ve got to fish where others aren’t fishing—and the mining sector could be primed for a resurgence. That’s why top Motley Fool analysts just revealed their exciting new research on 5 ASX miners they believe could help you profit in 2019 and beyond…

Including:

The best way we see to play the global zinc shortage… Our #1 favourite large-cap miner (hint: it’s not BHP)… one early-stage gold miner we think could hit the motherlode… Plus two more surprising companies you probably haven’t heard of yet!

For free access to our brand-new research, simply click here or the link below. But be warned, this research is available free for a limited time only, and we reserve the right to withdraw it at any time.

Click here for your FREE report!