UDC Finance, a unit of ANZ Bank New Zealand, has recorded an increase of 24 per cent in its earnings during the first half of the year.

The financial firm was able to boost earnings as it recorded higher margins on its interest income and recognising lower bad debts. Its net profit rose to $23.8 million during the first six months till 31 March, compared to $18.7 million recorded during the same period of the previous year, the Wellington-based bank said in a statement.

Its interest income remained stable at $88.7 million but its interest expenses fell 7.7 per cent to $41.9 million during the period. This allowed the company to record a 7.8 per cent increase in net interest income to $46.8 million during the period. It also wrote back an $892,000 gain from credit impairment compared to a charge of $1.8 million in the previous year. The total net loans rose $2.04 billion as at March 31 from $2.02 billion a year earlier. It also recorded a 14 per cent rise in hire purchase contracts to $667.9 million.

The lender, which has been able to survive the economic slowdown, recorded a capital ratio of 16.3 per cent during March, which is much higher than the 8 per cent required by the Reserve Bank.