Australia’s central bank swings to A$11 billion profit, again skips paying dividend to government

Australia’s central bank swung to an accounting profit last financial year on lower bond yields and a depreciating currency, though it remained in negative equity and did not pay a dividend to the government for a fourth straight year.

The Reserve Bank of Australia (RBA) recorded an A$11 billion (S$9.4 billion) profit in the 12 months through June 2025, according to its annual report released on Wednesday (Oct 8), while underlying earnings remained negative.

The RBA’s equity position improved, led by valuation gains on its gold holdings, though it still operated with A$5.3 billion negative equity as liabilities continued to exceed assets.

“This does not affect our operations or ability to perform our policy functions,” governor Michele Bullock said in the report. “But the Governance Board considers it important that the RBA’s capital should be restored over time.”

Treasurer Jim Chalmers “has indicated continued support for this approach, noting that a decision about retention of earnings is made each year,” she added.

The RBA’s status is unusual as most other central banks typically use a government indemnity.

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The central bank saw a 15 per cent increase in its workforce in the year-ended June, the annual report showed. That reflected additional resources required to implement its transformation agenda following an independent review of the RBA’s operations that prompted the creation of the governance board. The increased staff are concentrated in technology and corporate support, it added.

Bullock, whose total remuneration stood at A$1.195 million in the year through June 2025, said the RBA was able to meet all the targets set for the financial year, with inflation inside the 2-to-3 per cent target range and the economy close to full employment.

The RBA left its key rate unchanged last month after easing three times this year. At the time, Bullock pointed to a stronger-than-expected pick-up in household consumption driven by real income growth and a tight labour market. That’s a key reason many economists expect the rate-setting board to show patience on policy.

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The RBA’s August update of forecasts showed trimmed mean inflation, a core gauge of prices, easing to 2.6 per cent by December 2025, and staying there until mid-2027. The bank will release a new round of forecasts next month.

Bullock’s deputy Andrew Hauser, who became the first foreigner to join the upper echelons of the RBA, had total remuneration of A$879,714 last financial year. BLOOMBERG