Australia's Westpac posts 10 pct rise in H1 cash profit

SYDNEY Thu May 2, 2013 5:54pm EDT

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SYDNEY May 3 (Reuters) - Westpac Banking Corp, Australia's third-largest lender, reported a forecast-beating 10 percent rise in first-half profit on Friday, as the bank's Australian business recorded double digit earnings growth.

Westpac's record cash profit of A$3.53 billion ($3.62 billion) in the six months to March 31 compared with A$3.195 billion a year ago.

Analysts on average had expected Westpac to report a cash profit, which excludes one-offs and non-cash accounting items, of A$3.4 billion.

The bank raised its dividend to A$0.86 from A$0.82 in the prior half year and announced a A$0.10 per share special dividend.

Net interest margin, a measure of profitability, was up 2 basis points to 2.19 percent, while Tier I capital, a measure of a bank's ability to absorb unforeseen losses, was up 100 basis points to 8.7 percent at the end of the half-year.

Westpac said it expects credit growth to remain relatively modest.

($1 = 0.9758 Australian dollars) (Reporting by Jane Wardell; Editing by Lincoln Feast)

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