ASB, New Zealand's largest Australian-owned bank, reported a full-year profit of NZ$1.3 billion for the year ended June, down 2 percent from the previous year, with a NZ$135 million class action settlement contributing to a 16 percent rise in operating costs to NZ$1.65 billion, RNZ reports.

Operating expenses also climbed due to higher staff costs, technology spending and increased bad debt provisions, which rose 30 percent to NZ$78 million. Net interest income grew 8 percent to NZ$3.14 billion. Home lending increased 6 percent to NZ$84.5 billion and business and rural lending rose 6 percent to NZ$36.2 billion.

ASB chief executive Vittoria Shortt attributed the challenging result to economic disruption from Middle East conflict and rising inflation. "The economic recovery has been very stop-start," she said, adding that ASB customers had weathered conditions well, with fewer households struggling to repay loans, RNZ business (NZ) reports.