In other words, funding costs are falling before there is a dip in income from assets. But the more protracted the period of low interest rates and the steeper the decline in interest rates, the sharper the drop in interest income and the lower the profit.
This is particularly evident in rural communities on the West Coast of the South Island where there is only one bank ATM located between Wanaka and Hokitika – a distance of 418 kilometres. These rural communities are now more likely to be serviced by independent cash providers which charge fees and are generally located inside retailer premises (with limited hours).