TSB reports a strong year and continued momentum

TSB has reported a strong financial performance for the year ended 31 March 2026, while continuing to invest in its customers, people, communities and long-term strategy.

The Bank delivered a Net Profit Before Tax of $63.3 million for the year, up 10% on the previous year. In relation to the financial year, TSB declared $11.5 million in dividends to shareholder Toi Foundation Holdings Limited, the commercial arm of philanthropic organisation Toi Foundation.

Performance was underpinned by continued growth in net interest income, disciplined cost management and a sustained focus on simplifying how the Bank operates. The Bank benefited from a favourable interest rate environment with Net Interest Margin increasing by 20 basis points to 2.26%, supported in part by the decreasing interest rate environment and customers delaying fixing rates. Return on Equity improved to 5.7% and the Bank continued to maintain a strong funding position.

TSB has also continued to invest in its future, with 98% of customer transactions now completed through digital channels, more than $2 million recovered for customers impacted by fraud, and ongoing investment in digital capability, fraud prevention and regulatory compliance.

Chair Mark Darrow says the results reflect the Bank's focus on building stronger foundations for long-term growth.

"Over the past year we've continued to strengthen TSB, while staying true to what makes us different - putting people first.”

“We’ve delivered a resilient financial performance in what remains a challenging and uncertain environment.”

"We've made solid progress on our ambition to become the digital bank of choice with a human heart. That means making banking easier through simple digital experiences while continuing to provide the personal support our customers value."

Chief Executive Officer Kerry Boielle says the result reflects the hard mahi of TSB's people and the Bank's ongoing commitment to delivering more for customers and communities.

"This has been a year of disciplined execution. We've enhanced our digital channels, introduced new tools to help protect customers from fraud and scams, and continued to grow our support for small and medium-sized businesses across New Zealand."

TSB was recognised with multiple Canstar awards during the year, including the 2025 Outstanding Value Home Lender award, the 2025 Outstanding Value Savings Accounts (Flexible Saver) award and the 2025 Bank of the Year Credit Cards award, reflecting the Bank's focus on delivering competitive and excellent value products and services for customers.

The Bank also continued its community support through its ownership by Toi Foundation, and through initiatives including the TSB Festival of Lights, Stadium Taranaki and a range of local community projects. During TSB's 175th anniversary year, employees contributed more than 1,500 volunteer hours and exceeded the goal of delivering 175 Acts of Kindness across the communities they serve.

Looking ahead, Darrow says TSB remains focused on its strategy, while acknowledging the proposed merger being considered by its shareholder.

"Our strategy is clear. We are focused on simplifying the business, improving productivity and efficiency, investing in better digital experiences, and giving our people more time to support customers through the moments and decisions that matter most."

While increasing regulatory requirements continue to add cost and complexity, we remain committed to meeting these obligations and continuing to advocate for settings that enable strong competition and better outcomes for Kiwi.

At the same time, we recognise that Toi Foundation, the 100% owner of TSB, is currently seeking Taranaki community feedback on a proposal for TSB to merge with Heartland Bank Limited to create TSB Heartland Bank.

Darrow says the TSB Board supports the proposal as being in the best interests of the Bank, recognising the inherent disadvantages smaller regional banks face in competing at scale, investing in technology, and responding to increasing regulatory requirements.

If the proposal proceeds, it would accelerate the future pathway for TSB through greater scale and availability of growth capital, while preserving the customer service ethos that TSB is famous for.

"The work undertaken over recent years to strengthen TSB has put the Bank in a position where a merger is now a feasible option for our shareholder to consider. That is an important reflection of the progress made by our people and the quality of the business we have today."

Boielle says TSB remains focused on delivering for customers, communities and people while that process continues.

“TSB has a proud 175-year history of serving its customers and communities. Whatever the outcome of the proposal, our focus remains on continuing to do the right thing for our customers, supporting our people, and contributing to better banking outcomes for Aotearoa.”