Nine out of 10 brokers say banks profited from GFC

Over 90 percent of the 356 brokers surveyed said that they thought Australia’s banks had profited from the GFC and on first glance the figures would appear to back this up.

Westpac has seen its profits soar over the last few years, announcing a figure of $1.64 billion for the six months to 31 March 2007, rising to $2.875 billion for the six months to 31 March 2010.

CBA’s pre-GFC profit was $2.19 billion for the six months to December 2007, with the bank reporting $2.914 billion for the six months to December 2009.

In contrast, ANZ and NAB's net profits have remained on par since the GFC. ANZ recorded an interim cash profit of $1.936 billion for the six months to March 2007, and again (at $1.936 billion) for the six months to March 2010.

Similarly, NAB achieved an interim profit result of $2.13 billion in the six months to March 2007, with an interim profit for the six months to March 2010 sitting consistently at $2.1 billion.

According to Fujitsu Consulting’s executive director Martin North, while the big banks have emerged from the recent global crisis in reasonable shape it has been a different story for smaller lenders.

“Australia’s smaller lenders have really suffered at the hands of the GFC,” Mr North told The Adviser.

“Funding costs have gone through the roof and they have not benefited from the perceived flight to quality.

Mr North said that the GFC had also been a double edged sword for the majors.

“Australia’s bigger players have been able to secure a greater share of the market as a result of the GFC. But while the majors’ market share has benefited from the crisis, their profitability is still largely on par with 2007,” he said.