The public's trust in banks has fallen below even supermarkets, as profits surge in the middle of a cost of living crisis.

Australian bank giants ANZ, BNZ, ASB and Westpac reported record profits earlier this year, despite economic pressures.

Consumer NZ's latest quarterly sentiment survey found 39 percent of New Zealanders did not trust their banks.

Consumer NZ chief executive Jon Duffy said people were frustrated by high fees and poor customer service.

"Consumers aren't seeing value in what they're paying for when they deal with their banks," Duffy said.

"It's a low point for the banks, it's the biggest drop we've seen since we've been running this survey, which is over two years. It's got to the point where [banks] are less trusted than the supermarkets, which is saying something."

The worst results were concentrated around the big Australian banks.

"The smaller banks are actually doing a lot better than the larger banks," Duffy said.

"The top four, the biggest, most profitable companies in New Zealand, are coming out with the poorest level of customer satisfaction. Whereas the smaller New Zealand-owned entities are doing much better."

High fees were one of the biggest complaints, but Duffy said it was not all the banks' fault.

"The Reserve Bank is moving interest rates up. So if you've got a mortgage, you're paying a whole lot more.

"That's not necessarily all the banks' fault, but you're also paying fees and you're also expecting a level of service from your bank that this level of trust suggests isn't being returned. People aren't seeing value for money."

Those fees, contrasted against massive profits for the banks themselves, had customers frustrated.

"The high level of profitability will be making people question the level of service they're getting," Duffy said. "This sector is highly profitable, and in a cost of living crisis that's really going to irk some people."

Finance Minister Grant Robertson said he still trusted banks, but he understood public sentiment was turning.

"There's a debate to be had about profits, there's a debate to be had about the way in which an individual consumer might have an experience with a bank," Robertson said after a pre-Budget speech at BNZ's head office.

"We need banks, banks are part of the system in which we work. When it comes to levels of bank profit, banks have to justify, particularly in difficult economic circumstances, the level of profits that they have in order to keep their social license.

"I haven't read the [Consumer NZ] report, so I don't know how much profits feed in to people's view about trust, but those issues are definitely ones they have to justify."

Duffy said an investigation might be necessary.

"I think we need to have an independent assessment around the level of competition in our banking sector and work out whether there are interventions that can be made to increase competition, and hopefully increase the level of customer service and innovation in the sector."