Kiwibank's profit plunges as bad loan charges soar

However, its net interest income jumped 52% and its mortgage book appears to have continued to grow much faster than its market share.

Kiwibank's latest disclosure statement shows net profit for the three months ended March plummeted to just $0.8 million from $12.2 million in the same quarter of 2010. That took net profit for the nine months ended March to $14.7 million, down 59%.

Charges against profit jumped to $25.8 million from just $3.2 million in the March quarter last year, taking charges for the nine months ended March to $56.8 million from $12.9 million in the year-earlier nine months.

A disproportionate share of the bad loans are to businesses in Christchurch - Kiwibank started to lend to small to medium sized businesses about six years ago.