Australia’s Westpac Banking Corp reported a 5% increase in net profit to A$1.9 billion for the third quarter, driven by wider margins and gains in lending and deposits. The bank’s shares surged over 5% in response, hitting a decade-high at A$35.66.

Net interest margins improved to 1.99% from 1.92% a year ago, with net interest income reaching A$5 billion. Customer deposits grew by A$10 billion and gross loans by A$16 billion. Westpac’s treasury and markets segment also saw a significant increase in contribution.

CEO Anthony Miller credited the reduction in interest rates for aiding households and businesses, leading to lower customer stress levels. Late mortgage repayments fell, while the bank’s strategic focus on cost-cutting and technology streamlining under the UNITE program continued.

Australian banking stocks, including Westpac, have seen increased investor demand, resulting in soaring valuations. The Reserve Bank of Australia’s rate cuts have supported a favourable interest-rate environment, contributing to Westpac’s strong performance.

The results come after Commonwealth Bank of Australia reported its strongest annual cash earnings. National Australia Bank is set to report its third-quarter earnings next week. Westpac’s shares are up nearly 20% in the past year and 4.9% year-to-date.

Read more at Yahoo Finance: Australia’s Westpac profit grows 5% on margin lift and higher lending