The boss of our largest bank is defending higher interest margins on this side of the Tasman

ANZ New Zealand has confirmed a 21-percent rise in annual profit -- with its net interest margin up three basis points to 2.6 percent.

ANZ Australia's overall net interest rate margin is lower, at 2.39 percent.

ANZ New Zealand Chief Executive Antonia Watson says New Zealand's a very different and more remote economy, where banks are required to hold more capital.

She says that more than accounts for the difference in the interest rate margin.