Westpac is out with its first half result and it’s another weak one for banks as revenue rose 2%, NIM fell 4bps, costs were flat, bad debts were 15bps. NPAT was up 3%. It was all roughly 1% below consensus.
Moreover, interest only loans were 46% of flow and 50% of the mortgage book showing that the pull back to 30% targeted by APRA is going to be meaningful for WBC.
The result confirms that the banks are now massively levered utilities with low growth and high dividends equaling no investment case.
