ASB is reporting a one percent increase in net profit, for last year's second half.

Profit margins remained flat, but home lending grew five percent and business and rural lending increased two percent.

CEO Vittoria Short says this is a sign the economy is turning a corner for the better after a lengthy downturn.

"Inflation's back in target range, we know that the OCR or interest rates are moving downwards to more neutral levels and what we can see is that our customers, who have been doing it tough and are stressed - our actions are helping."

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