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Answers / Banking & Financial Stability

How have Australian bank profits changed?

Ask this yourself

Show me how profitable Australian banks are, where that profit actually comes from, and whether they earn more or less than banks in Britain, Canada and the United States.

Australian deposit-takers returned 11.3 per cent on equity in the December quarter 2025 and 0.92 per cent on assets. A decade earlier the figures were 20.1 and 1.52 per cent, so return on equity is 57 per cent of its 2015 level and return on assets 61 per cent. The fall shows on both measures.

Return on equity
11.3%
Dec quarter 2025 · 20.1% in Dec quarter 2015
Return on assets
0.92%
Dec quarter 2025 · 1.52% in Dec quarter 2015
Interest margin as a share of gross income
76.7%
Dec quarter 2025 · 59.4% in Dec quarter 2015
Cost-to-income ratio
53.8%
Dec quarter 2025 · 42.8% in Dec quarter 2015

1. Both measures fell, and that rules out the easy explanation

fell from 20.1 per cent at the end of 2015 to 11.3 per cent in the December quarter 2025. The convenient reading is that higher capital requirements inflated the denominator — but , whose denominator is the balance sheet rather than equity, fell from 1.52 per cent to 0.92 per cent over the same years. Australian deposit-takers are earning less per dollar of assets, not merely spreading the same earnings over more equity.

Profitability of Australian deposit-takers

Return on equity and return on assets

  • Return on equity
  • Return on assets

Per cent · Quarter

International Monetary Fund. Financial Soundness Indicators (FSI), Core and Additional Indicators, IMF.STA:FSIC(13.0.1), https://data.imf.org/en/Data-Explorer?datasetUrn=IMF.STA:FSI. Accessed on 15 September 2026. Used under the IMF Copyright and Usage Terms — all rights reserved; not a Creative Commons licence. Financial Soundness Indicators (FSI), Core and Additional Indicators

Show the numbers
Profitability of Australian deposit-takers
QuarterReturn on equityReturn on assets
2006-Q14.5%0.46%
2006-Q28.4%0.82%
2006-Q315.1%1.3%
2006-Q418.0%1.6%
2007-Q119.8%1.5%
2007-Q213.6%1.2%
2007-Q318.6%1.5%
2007-Q415.9%1.3%
2008-Q118.8%1.0%
2008-Q220.3%1.2%
2008-Q326.2%1.4%
2008-Q425.5%1.4%
2009-Q13.7%0.49%
2009-Q2-0.06%0.26%
2009-Q313.2%1.1%
2009-Q49.9%0.91%
2010-Q1-3.8%0.02%
2010-Q28.2%0.77%
2010-Q34.4%0.53%
2010-Q4-4.8%0.03%
2011-Q133.5%2.1%
2011-Q220.3%1.4%
2011-Q322.2%1.5%
2011-Q416.4%1.2%
2012-Q14.2%0.60%
2012-Q215.2%1.2%
2012-Q318.3%1.4%
2012-Q416.0%1.3%
2013-Q112.5%1.1%
2013-Q217.2%1.4%
2013-Q322.0%1.7%
2013-Q419.6%1.5%
2014-Q116.8%1.3%
2014-Q215.7%1.3%
2014-Q313.3%1.1%
2014-Q416.5%1.3%
2015-Q130.5%2.1%
2015-Q220.3%1.5%
2015-Q321.4%1.6%
2015-Q420.1%1.5%
2016-Q113.1%1.1%
2016-Q29.6%0.89%
2016-Q38.3%0.83%
2016-Q47.9%0.82%
2017-Q119.0%1.5%
2017-Q216.8%1.4%
2017-Q311.5%1.1%
2017-Q413.2%1.2%
2018-Q17.9%0.84%
2018-Q215.4%1.3%
2018-Q317.0%1.4%
2018-Q416.8%1.4%
2019-Q19.3%0.85%
2019-Q211.8%1.1%
2019-Q39.4%0.90%
2019-Q410.9%1.00%
2020-Q1-0.90%0.06%
2020-Q27.8%0.67%
2020-Q3-1.5%0.09%
2020-Q41.8%0.33%
2021-Q12.5%0.51%
2021-Q26.1%0.74%
2021-Q39.4%0.96%
2021-Q49.9%0.99%
2022-Q114.7%1.2%
2022-Q215.8%1.3%
2022-Q312.5%1.1%
2022-Q416.4%1.3%
2023-Q112.2%1.1%
2023-Q212.9%1.1%
2023-Q310.2%0.92%
2023-Q411.9%1.0%
2024-Q15.8%0.64%
2024-Q211.5%0.98%
2024-Q311.3%0.97%
2024-Q411.0%0.94%
2025-Q111.0%0.91%
2025-Q210.9%0.91%
2025-Q311.1%0.92%
2025-Q411.3%0.92%

2. Mid-table among the economies compared

Canadian banks earn 16.1 per cent on equity; British and American banks sit close to Australia, and Swiss and German returns are far lower. cannot be read across jurisdictions without the capital requirement behind it, and this chart carries no capital series, so it supports a ranking and not an explanation. Australia's position here says less than the trend in the previous chart does.

Return on equity, latest quarter

Deposit-takers; latest available quarter shown against each economy

  • Australia (2025-Q4)
  • Canada (2026-Q1)
  • Other series (7)

Per cent return on equity · Economy

International Monetary Fund. Financial Soundness Indicators (FSI), Core and Additional Indicators, IMF.STA:FSIC(13.0.1), https://data.imf.org/en/Data-Explorer?datasetUrn=IMF.STA:FSI. Accessed on 15 September 2026. Used under the IMF Copyright and Usage Terms — all rights reserved; not a Creative Commons licence. Financial Soundness Indicators (FSI), Core and Additional Indicators

Show the numbers
Return on equity, latest quarter
EconomyAustralia (2025-Q4)Canada (2026-Q1)United Kingdom (2026-Q1)United States (2025-Q4)Germany (2025-Q4)Netherlands (2026-Q1)Switzerland (2026-Q1)Japan (2025-Q3)Korea (2024-Q2)
Australia11.4%————————
Canada—16.1%———————
United Kingdom——11.9%——————
United States———11.4%—————
Germany————5.6%————
Netherlands—————10.3%———
Switzerland——————2.2%——
Japan———————13.4%—
Korea————————9.1%

3. And they depend on net interest more than they used to

Net interest — interest earned on loans and securities less interest paid on deposits and other funding — has gone from 59.4 per cent of gross income in 2015 to 76.7 per cent in 2025, though not smoothly: it touched 101.3 per cent in the March quarter 2021, which requires other income to have been negative. Trading income is 8.4 per cent, up from 6.4 in 2015 and down from a 16.3 per cent peak in the March quarter 2024. Gross income here is the IMF’s bank aggregate — the interest margin plus fees, trading and other income — not any household measure. The series record the mix, not why it changed.

Where Australian bank income comes from

Components as a share of gross income

  • Interest margin
  • Trading income

Per cent of gross income · Quarter

International Monetary Fund. Financial Soundness Indicators (FSI), Core and Additional Indicators, IMF.STA:FSIC(13.0.1), https://data.imf.org/en/Data-Explorer?datasetUrn=IMF.STA:FSI. Accessed on 15 September 2026. Used under the IMF Copyright and Usage Terms — all rights reserved; not a Creative Commons licence. Financial Soundness Indicators (FSI), Core and Additional Indicators

Show the numbers
Where Australian bank income comes from
QuarterInterest marginTrading income
2006-Q146.66.9
2006-Q248.88.8
2006-Q348.95.7
2006-Q451.15.2
2007-Q153.210.2
2007-Q254.39.3
2007-Q349.98.4
2007-Q452.88.6
2008-Q160.57.3
2008-Q254.66.7
2008-Q349.16.8
2008-Q447.65.0
2009-Q163.24.3
2009-Q273.76.8
2009-Q356.16.0
2009-Q461.16.5
2010-Q183.46.8
2010-Q264.36.2
2010-Q370.55.8
2010-Q490.48.1
2011-Q151.55.1
2011-Q263.77.2
2011-Q361.66.5
2011-Q467.85.6
2012-Q182.79.1
2012-Q266.37.6
2012-Q361.45.9
2012-Q464.36.2
2013-Q170.08.0
2013-Q264.07.7
2013-Q358.76.8
2013-Q461.46.9
2014-Q166.48.2
2014-Q267.47.6
2014-Q370.38.4
2014-Q465.97.6
2015-Q150.24.8
2015-Q260.15.1
2015-Q357.76.0
2015-Q459.46.4
2016-Q169.510.1
2016-Q279.18.9
2016-Q382.37.6
2016-Q482.57.4
2017-Q160.68.7
2017-Q264.88.8
2017-Q374.68.4
2017-Q471.310.0
2018-Q181.79.5
2018-Q266.96.0
2018-Q363.96.1
2018-Q464.96.1
2019-Q177.010.1
2019-Q272.710.6
2019-Q377.210.3
2019-Q474.39.2
2020-Q183.99.2
2020-Q271.07.1
2020-Q398.210.9
2020-Q491.19.0
2021-Q110111.6
2021-Q288.610.2
2021-Q377.38.4
2021-Q476.77.6
2022-Q165.96.7
2022-Q265.45.7
2022-Q373.87.0
2022-Q467.46.2
2023-Q175.216.3
2023-Q273.913.8
2023-Q379.312.6
2023-Q474.911.3
2024-Q174.016.3
2024-Q277.311.0
2024-Q377.610.2
2024-Q477.410.1
2025-Q177.68.8
2025-Q278.19.2
2025-Q376.38.7
2025-Q476.78.4

4. Costs went the wrong way

The cost-to-income ratio is noninterest expenses over gross income. It took 42.8 cents of every dollar in 2015 and takes 53.8 cents in the December quarter 2025. Personnel is 57.4 per cent of those expenses, up from 50.0 per cent. Beyond the staff share, the IMF publishes no breakdown of what the rest is spent on, and nothing on this page decomposes the fall in return on assets between costs, margins and the size of the balance sheet.

Cost structure of Australian deposit-takers

Noninterest expenses against gross income, and the staff share of them

  • Noninterest expenses to gross income
  • Personnel share of noninterest expenses

Per cent · Quarter

International Monetary Fund. Financial Soundness Indicators (FSI), Core and Additional Indicators, IMF.STA:FSIC(13.0.1), https://data.imf.org/en/Data-Explorer?datasetUrn=IMF.STA:FSI. Accessed on 15 September 2026. Used under the IMF Copyright and Usage Terms — all rights reserved; not a Creative Commons licence. Financial Soundness Indicators (FSI), Core and Additional Indicators

Show the numbers
Cost structure of Australian deposit-takers
QuarterNoninterest expenses to gross incomePersonnel share of noninterest expenses
2006-Q149.3%50.9%
2006-Q252.3%53.9%
2006-Q351.3%49.7%
2006-Q453.2%50.8%
2007-Q152.2%52.6%
2007-Q260.4%50.1%
2007-Q356.4%49.5%
2007-Q458.7%48.5%
2008-Q152.7%52.7%
2008-Q252.9%48.5%
2008-Q348.1%47.2%
2008-Q447.2%44.7%
2009-Q160.8%41.9%
2009-Q265.0%43.3%
2009-Q349.0%44.6%
2009-Q452.6%44.9%
2010-Q179.7%43.0%
2010-Q260.9%43.8%
2010-Q367.3%44.3%
2010-Q484.4%45.0%
2011-Q136.9%60.4%
2011-Q245.6%55.9%
2011-Q344.0%55.0%
2011-Q448.5%53.9%
2012-Q161.4%52.2%
2012-Q247.7%52.0%
2012-Q345.1%50.1%
2012-Q447.2%50.5%
2013-Q149.4%51.0%
2013-Q244.6%51.4%
2013-Q341.0%51.3%
2013-Q443.3%50.9%
2014-Q145.7%53.5%
2014-Q247.9%51.3%
2014-Q350.8%50.3%
2014-Q447.1%51.2%
2015-Q133.3%50.9%
2015-Q241.1%53.2%
2015-Q342.0%49.7%
2015-Q442.8%50.0%
2016-Q146.1%52.3%
2016-Q251.1%53.6%
2016-Q352.8%55.9%
2016-Q453.8%54.7%
2017-Q141.1%53.0%
2017-Q243.3%52.5%
2017-Q349.6%52.0%
2017-Q447.5%51.7%
2018-Q157.2%50.8%
2018-Q246.2%50.0%
2018-Q344.9%49.3%
2018-Q444.7%49.6%
2019-Q157.1%48.5%
2019-Q251.1%49.6%
2019-Q355.1%48.3%
2019-Q452.6%48.8%
2020-Q167.2%41.0%
2020-Q253.1%45.5%
2020-Q373.0%46.4%
2020-Q466.7%47.8%
2021-Q171.9%52.6%
2021-Q262.3%54.0%
2021-Q356.6%53.5%
2021-Q455.2%54.4%
2022-Q147.0%56.5%
2022-Q246.6%54.6%
2022-Q351.1%53.8%
2022-Q445.7%55.1%
2023-Q148.6%56.5%
2023-Q249.5%56.5%
2023-Q353.1%58.2%
2023-Q450.5%58.6%
2024-Q161.3%57.8%
2024-Q251.9%58.5%
2024-Q352.0%58.0%
2024-Q452.7%58.1%
2025-Q153.0%57.1%
2025-Q254.0%57.0%
2025-Q354.2%57.4%
2025-Q453.8%57.4%

What to watch for

  • The IMF's return on equity for deposit-takers is an annualised quarterly figure and is volatile quarter to quarter. Read the level of the line, not its last point.
  • Return on equity is not comparable across countries without the capital requirement behind it. A system forced to hold more capital will report a lower return on the same underlying earnings, and no capital series is shown on this page.
  • Reporting economies publish on different schedules, so each point in the cross-country chart carries its own quarter. Australia's return on equity is a December quarter 2025 figure while several comparators are at March 2026, so the ranking is not a common-quarter comparison.
  • Income and expense indicators end in the December quarter 2025 while balance-sheet indicators run to March 2026. The profitability figures on this page are one quarter older than the capital figures elsewhere in this topic.
  • APRA excludes foreign bank branches from return on equity because they do not report shareholders' equity, so the measure covers a slightly narrower population than return on assets.
  • The December quarter 2010 is an extreme outlier across every series on this page — return on equity of −4.8 per cent, noninterest expenses at 84.4 per cent of gross income. It is shown rather than trimmed, but it should not be read as a trend.
  • This page does not explain the fall in profitability. It has no expense breakdown beyond the personnel share, no margin decomposition and no series on divestments, so any attribution — to compliance and technology spending, to capital requirements, or to the sale of wealth and insurance businesses after the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry — would be interpretation rather than measurement, and none is made here.
  • Every ratio of two published levels on this page is calculated by Aard; the IMF publishes the levels and the indicator percentages, not the comparisons between periods.

References

Data extracted . Reviewed 2026-09-15 by Aard Data Team. Each numbered entry is the publication that documents the figures; the calls beneath it are the ones the retrieval actually made, recovered from the authoring session’s own transcript.

  1. [1]International Monetary Fund, Financial Soundness Indicators (FSI), Core and Additional Indicators, March quarter 2026
    Released 2026-09-15
    Vintage: Observations carry a publication timestamp of 2026-09-15T06:04:42Z. National compilers revise supervisory returns without notice, and reporting economies publish on different schedules, so the latest available quarter differs by country.
    International Monetary Fund. Financial Soundness Indicators (FSI), Core and Additional Indicators, IMF.STA:FSIC(13.0.1), https://data.imf.org/en/Data-Explorer?datasetUrn=IMF.STA:FSI. Accessed on 15 September 2026. Used under the IMF Copyright and Usage Terms — all rights reserved; not a Creative Commons licence.
    • The call this page made · extracted 15 September 2026
      IMF.STA:FSIC(13.0.1)https://api.imf.org/external/sdmx/2.1/data/FSIC/AUS.REM+S1+S11+S123+S128+S1281+S1282+S129+S12CFSI+S12R+S14..A+M+Q
      • 20.055 % · 2015-Q4 · Return on equity, deposit-takers, Australia
      • 11.346 % · 2025-Q4 · Return on equity, deposit-takers, Australia
      • 1.516 % · 2015-Q4 · Return on assets, deposit-takers, Australia
      • 0.922 % · 2025-Q4 · Return on assets, deposit-takers, Australia

      The Australian call, profitability pair. Both are annualised quarterly figures. The chart runs 2006-Q1 to 2025-Q4; these are the two anchors the prose and both key figures quote.

    • The call this page made · extracted 15 September 2026
      IMF.STA:FSIC(13.0.1)https://api.imf.org/external/sdmx/2.1/data/FSIC/AUS.REM+S1+S11+S123+S128+S1281+S1282+S129+S12CFSI+S12R+S14..A+M+Q
      • 59.413 % of gross income · 2015-Q4 · Interest margin to gross income, deposit-takers, Australia
      • 76.667 % of gross income · 2025-Q4 · Interest margin to gross income, deposit-takers, Australia
      • 8.381 % of gross income · 2025-Q4 · Trading income to gross income, deposit-takers, Australia

      The Australian call, income composition. The attribution of the shift to post-royal-commission divestments is the page's interpretation and is caveated as such; only these three values come from the call.

    • The call this page made · extracted 15 September 2026
      IMF.STA:FSIC(13.0.1)https://api.imf.org/external/sdmx/2.1/data/FSIC/AUS.REM+S1+S11+S123+S128+S1281+S1282+S129+S12CFSI+S12R+S14..A+M+Q
      • 42.789 % of gross income · 2015-Q4 · Noninterest expenses to gross income, deposit-takers, Australia
      • 53.839 % of gross income · 2025-Q4 · Noninterest expenses to gross income, deposit-takers, Australia
      • 49.977 % of noninterest expenses · 2015-Q4 · Personnel expenses to noninterest expenses, deposit-takers, Australia
      • 57.4 % of noninterest expenses · 2025-Q4 · Personnel expenses to noninterest expenses, deposit-takers, Australia

      The Australian call, cost structure.

    • The call this page made · extracted 15 September 2026
      IMF.STA:FSIC(13.0.1)https://api.imf.org/external/sdmx/2.1/data/FSIC/CAN+GBR+USA+NZL+NLD+SWE+DEU+CHE+KOR+JPN.S12CFSI+S14.FSI688_CFSI_PT+FSI626_CFSI_PT+AQ12_CFSI_PT+ROA_CFSI_PT+ROE_CFSI_PT+FSI99_CFSI_PT+FSI107_CFSI_PT+T1KTA_CFSI_PT+FSI765_CFSI_PT+FSI157_AFSI_PT+FSI179_AFSI_PT+FSI85_AFSI_PT+AQ14_CFSI_PT.Q
      • 16.07 % · 2026-Q1 · Return on equity, deposit-takers, Canada
      • 11.87 % · 2026-Q1 · Return on equity, deposit-takers, United Kingdom
      • 11.37 % · 2025-Q4 · Return on equity, deposit-takers, United States
      • 5.63 % · 2025-Q4 · Return on equity, deposit-takers, Germany
      • 10.26 % · 2026-Q1 · Return on equity, deposit-takers, Netherlands
      • 2.16 % · 2026-Q1 · Return on equity, deposit-takers, Switzerland
      • 13.41 % · 2025-Q3 · Return on equity, deposit-takers, Japan
      • 9.1 % · 2024-Q2 · Return on equity, deposit-takers, Korea

      The comparator call. Australia's 11.35% is the Australian call's 2025-Q4 return on equity, in imf-fsi-2026-q1-aus-returns. The 3.3-point capital gap the commentary names against Canada comes from the capital records, not this one.

    • The call this page made · extracted 16 September 2026
      IMF.STA:FSIC(13.0.1)https://api.imf.org/external/sdmx/2.1/data/FSIC/AUS.S12CFSI..Q?startPeriod=2008&endPeriod=2026
      • 6.37 % of gross income · 2015-Q4 · Trading income to total income, (Additional FSI), Deposit takers, PercentAUS.S12CFSI.FSI690_AFSI_PT.Q
      • 16.34 % of gross income · 2024-Q1 · Trading income to total income, (Additional FSI), Deposit takers, PercentAUS.S12CFSI.FSI690_AFSI_PT.Q
      • 4.3 % of gross income · 2009-Q1 · Trading income to total income, (Additional FSI), Deposit takers, PercentAUS.S12CFSI.FSI690_AFSI_PT.Q
      • 8.381 % of gross income · 2025-Q4 · Trading income to total income, (Additional FSI), Deposit takers, PercentAUS.S12CFSI.FSI690_AFSI_PT.Q
      • 101.33 % of gross income · 2021-Q1 · Interest margin to gross income, (Core FSI), Deposit takers, PercentAUS.S12CFSI.FSI99_CFSI_PT.Q
      • 59.413 % of gross income · 2015-Q4 · Interest margin to gross income, (Core FSI), Deposit takers, PercentAUS.S12CFSI.FSI99_CFSI_PT.Q
      • 76.667 % of gross income · 2025-Q4 · Interest margin to gross income, (Core FSI), Deposit takers, PercentAUS.S12CFSI.FSI99_CFSI_PT.Q

      IMF Financial Soundness Indicators, Australian deposit-takers, quarterly. Trading income to total income ranges from 4.30 per cent (2009-Q1) to 16.34 per cent (2024-Q1) and is 8.381 per cent at 2025-Q4. Interest margin to gross income reaches 101.33 per cent in 2021-Q1, the only quarter above 100, which requires other income components to have been negative.

    • The call this page made · extracted 15 September 2026
      IMF.STA:FSIC(13.0.1)https://api.imf.org/external/sdmx/2.1/data/FSIC/AUS.REM+S1+S11+S123+S128+S1281+S1282+S129+S12CFSI+S12R+S14..A+M+Q
      • 11.346 % · 2025-Q4 · Return on equity, deposit-takers, Australia
      • 20.563 % of risk-weighted assets · 2026-Q1 · Regulatory capital to risk-weighted assets, deposit-takers, Australia

      The caveat is about the response itself: income and expense indicators stop one quarter earlier than balance-sheet indicators. The two observations are the last of each, from the one call.

    • The call this page made · extracted 15 September 2026
      IMF.STA:FSIC(13.0.1)https://api.imf.org/external/sdmx/2.1/data/FSIC/AUS.REM+S1+S11+S123+S128+S1281+S1282+S129+S12CFSI+S12R+S14..A+M+Q
      • -4.813 % · 2010-Q4 · Return on equity, deposit-takers, Australia
      • 84.377 % of gross income · 2010-Q4 · Noninterest expenses to gross income, deposit-takers, Australia

      The same Australian call, at the one quarter the caveat singles out. Shown rather than trimmed, so the record names it explicitly.

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