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# Capital gains tax policy not hurting Westpac's housing investor loans this year
- URL: https://www.benchmarkanalytics.com.au/capital-gains-tax-policy-not-hurting-westpacs-housing-investor-loans-this-year/
- Published: 2026-08-10T01:37:34.000Z
- Updated: 2026-08-10T01:37:34.000Z
- Author: Nick Hossack
- Tags: Tax Reform, #banking

Westpac’s latest quarterly update - released today - shows mortgage demand softening, but the bank’s underlying financial performance — particularly its net interest margin — remains relatively resilient.

Average monthly mortgage applications fell to around 29,000 in the June quarter, down 11% from the March quarter. Westpac expects applications to fall further to a post-Budget run rate of about 26,000, representing a 20% decline from March-quarter levels.

Despite this, housing credit growth is still expected to rise. It forecasts total housing credit to grow 6.8% in FY26, before slowing to 4.7% in FY27 and recovering to 5.2% in FY28\. **Investor credit is expected to be particularly strong in FY26, growing 9.1%.**

Importantly for profitability, Westpac’s net interest margin is holding up. **NIM increased from 1.84% in the March quarter to 1.89% in the June quarter,** although it remains below the 1.94% recorded in the December quarter. Core NIM edged up from 1.77% to 1.78%, while the Treasury and Markets contribution increased from 0.07% to 0.11%.

Gross loans increased $17 billion during the June quarter to $908 billion, while deposits rose $14 billion to $759 billion. Both were 7% higher than a year earlier.

Westpac reported unaudited statutory net profit of $1.8 billion, with net profit excluding notable items also $1.8 billion, 2% above the first-half quarterly average.