The record profit run at Australia’s big four banks has ended

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The combined cash profits of the big four banks didn’t make last year’s record $30 billion.

With Westpac the last to report annual earnings today, the four posted a combined $29.65 billion cash profit.

The banks have been hit by a combination of bad loans from a series of corporate failures, low interest rates, a squeeze on net interest margins, losses on sales of assets, and the costs of restructuring.

Growth has stalled, with return on equity, a key measure of value for shareholders, shrinking.

But most of the banks have kept their dividend payouts, for now.

The exception is the ANZ which posted a final fully franked dividend of 80 cents a share, for a full year amount of 160 cents, a drop of 12%.

And the ANZ has foreshadowed fewer dollars for shareholders. The bank says it is working toward a fully franked payout ratio of 60% to 65% of cash profit, down from 80%.

Today Westpac CEO Bran Hartzer wound back the current 15% ROE (return on equity) target for the bank, saying it was no longer realistic. The new target is between 13% and 14%.

Westpac posted a flat full year cash profit of $7.822 billion, within analyst expectations, but dragged down by bad loans.

The NAB had a full year cash profit of $6.48 billion, an increase of 4.2% and within expectations.

The ANZ Bank posted an 18% fall in full year cash profit to $5.9 billion, dragged down by the cost of reforms, a process which includes a possible sale of its Australian wealth management business.

The Commonwealth, which posted in August, had the biggest cash profit at $9.45 billion, a 3% rise and in line with most forecasts.