As per the media reports, a normalized net profit of $52.5 million was posted by Kiwibank, for the year to the end of June, which was up 42% on the same period last year.

Kiwibank explained that the profit figures stood at $63.8 million, when an $11.1 million gain from a structural change in its ownership by New Zealand Post is added.

The credit for an enhancement in profit was given to a strong uptake in residential home loans by Kiwibank. The CEO of the New Zealand owned bank, Sam Knowles, expressed that it outperformed many of the large Australian-owned banks, particularly in the last quarter of 2008.

He continued: "The lending was extremely high quality and we believe at fair interest rates."

An increase by 52% was noticed in overall loans and advances from $5.6 billion to $8.5 billion, with retail deposits increasing by 39% from $4.8 billion to $6.7 billion.

It was further added by Knowles that uptake of the bank's Visa Debit Card was also very healthy.

Kiwibank explained that a good performance is maintained by its business banking division, apart from gaining market share, and strong growth in this area is predicted for the new financial year.