FollowingTuesday’s highly anticipated Reserve Bank board meeting,analysts are predicting a $3 billion half-year cash profit from ANZ Bank on Wednesday,and a $3.4 billion half-year profit from National Australia Bank on Thursday.
Next week,Westpac is expected to deliver a $2.8 billion half-year profit,while Commonwealth Bank,which reports on a different calendar,is tipped to notch up $2.1 billion in third quarter profits.
Macquarie Group,which is mainly exposed to conditions on global markets,is predicted to deliver a record full-year profit of about $4.5 billion this Friday.
Investors have pushed bank shares higher this year amid strong credit growth,low bad debts,and predictions that a sharp decline in profit margins will start reversing when the RBA lifts official rates from record lows,which is expected to begin on Tuesday.
Net interest margins - which compare bank funding costs with what they charge for loans - have been compressed as interest rates have plunged amid fierce competition and a boom in less profitable fixed-rate lending.
Principal at fund manager Alphinity,Andrew Martin,said cash rate hikes would benefit banks because they would seek to raise lending rates more aggressively than rates on deposits. Investors would be keen to hear more from bank bosses about the impact of higher rates on margins,he said.
“There’s this big expectation about upside leverage when rates get going,so I think the market will be looking for some guidance,” Martin said.