Australian banking giant Westpac on Monday posted a 15 percent slump in full-year net profit, but said momentum picked up in the second half and trumpeted a strong result in a difficult environment.
The profit in the 12 months to September 30 came in at Aus$5.97 billion (US$6.17 billion), compared with Aus$6.99 billion the previous year.
Australia's second largest bank by market capitalisation said the slide was largely due to the tax implications of its takeover of smaller rival St George.
A one-off benefit -- of more than Aus$1 billion -- from a tax consolidation related to the takeover pushed last year's profit higher.
While net profit was down, cash earnings -- the bank's preferred measure which strips out volatile items -- were up five percent at Aus$6.59 billion compared to the previous year, slightly above analyst expectations.
The market liked the result, with Westpac shares adding 32 cents, or 1.28 percent, to Aus$25.35. It was also welcomed by analysts, with City Index's Peter Esho saying earnings beating forecasts was an excellent outcome.
"The earnings beat might not look too significant on face value but, when taken in the overall context of what's been a very challenging year for the financial system globally, we think the outcome is excellent," he said.
Chief executive Gail Kelly called it "a strong result in a lower growth economic environment".
"We have strengthened our balance sheet while delivering attractive returns to shareholders and investing for future growth," she said.
"Our performance, particularly in the second half, demonstrates that we have increasing momentum across our businesses.
"Our disciplined approach to productivity has improved customer service and increased efficiency. Importantly, we continue to be the most efficient Australian bank, with an expense to income ratio down to 40.8 percent."
Kelly said the highlight was the solid performance of the new Australian Financial Services division, which includes the Australian retail banking, business banking and wealth operations.
Cash earnings from that arm were higher than the previous year, up 14 percent to Aus$2.1 billion as deposits and loans grew.
Improving efficiency was a focus for the bank, which cut staff by 1,760 in the year to September as part of a productivity programme, Kelly added.
"I expect overall the numbers of staff to reduce next year, but probably not at quite the rate we had over the last few years," she said.