UPDATE: Kiwibank cancels eftpos, debit cards after 2 ATMs hit by card skimmers

Kiwibank, the government owned lender and subsidiary of New Zealand Post, has taken urgent action and frozen some customer accounts after two of its ATMS were fitted with card skimming devices and funds were taken offshore.

The Wellington-based bank was contacting 1,500 customers who used the Courtneay Place Kiwibank ATM in Wellington between Feb. 16 and Feb. 20, and its Marewa ATM in Napier between Feb 19 and Feb. 20, spokesperson Bruce Thompson said in a statement. Of those affected, about half were Kiwibank customers. Some people were still being notified by their bank.

"In most cases their cards will have been cancelled and replaced and banks will ensure their accounts remain safe," Thompson said. "Some funds have been removed via overseas terminals using the information gained from the skimming devices, but this is currently being reimbursed to all the affected customers' accounts."

The affected machines have now been declare free from any devices and are fully functional.

This week the state owned bank said it expects to pay its first annual dividend after 13 years of operation, reflecting its increased size, record profits and its ability to fund its own activities. Kiwibank increased profit 37 percent to a record $71 million in the six months ended Dec. 31, it said in a statement. The banking unit accounted for the bulk of NZ Post's $100 million profit in the period.