A non-major bank has reported a 12% increase in its full year profit
Heartland Bank has reported a net profit after tax (NPAT) of $60.8 million for the full year ended June, an increase of 12% from the previous financial year.
According to the non-major bank the increase in profitability was driven primarily by growth in receivables across household, business and rural divisions, although net receivables for residential mortgages dropped by $10.3 million to $35.6 million during the reporting period.
Its net receivables for the household division increased by $277.8 million to $1.9 billion, with reverse mortgages, motor vehicle loans and personal loans increasing $126.1, $72.0, and $40.0 million respectively.
The bank’s net operating income for reverse mortgages was up $5.6 million to $29.8 million from the previous year. Net receivables from reverse mortgages in New Zealand and Australia were up by $42.5 million and $83.6 million to $405.2 million and $515.7 million respectively.
Business and rural divisions’ net receivables increased $96.2 million and $123.0 million respectively.
Its net operating income was at $171.3 million, up by $13.7 million from the previous year.
Operating costs were for the reporting year was at $71.7 million, an increase of $1.8 million, according to the bank. “This increase was due to business growth driving increased staff costs, partially offset by a reduction in one off project and compliance costs. The overall cost to income ratio was 42% for FY2017 compared to 44% in FY2016.”
“Looking forward, underlying asset growth is expected to continue, with strong household, business and rural volumes projected through execution of Heartland’s strategy, in particular the expansion of customer reach through digital and intermediary channels,” the bank said in a report.
For the financial year ending June 2018, Heartland said it expects its NPAT to be in the $65.0 million to $68.0 million range.
According to the non-major bank the increase in profitability was driven primarily by growth in receivables across household, business and rural divisions, although net receivables for residential mortgages dropped by $10.3 million to $35.6 million during the reporting period.
Its net receivables for the household division increased by $277.8 million to $1.9 billion, with reverse mortgages, motor vehicle loans and personal loans increasing $126.1, $72.0, and $40.0 million respectively.
The bank’s net operating income for reverse mortgages was up $5.6 million to $29.8 million from the previous year. Net receivables from reverse mortgages in New Zealand and Australia were up by $42.5 million and $83.6 million to $405.2 million and $515.7 million respectively.
Business and rural divisions’ net receivables increased $96.2 million and $123.0 million respectively.
Its net operating income was at $171.3 million, up by $13.7 million from the previous year.
Operating costs were for the reporting year was at $71.7 million, an increase of $1.8 million, according to the bank. “This increase was due to business growth driving increased staff costs, partially offset by a reduction in one off project and compliance costs. The overall cost to income ratio was 42% for FY2017 compared to 44% in FY2016.”
“Looking forward, underlying asset growth is expected to continue, with strong household, business and rural volumes projected through execution of Heartland’s strategy, in particular the expansion of customer reach through digital and intermediary channels,” the bank said in a report.
For the financial year ending June 2018, Heartland said it expects its NPAT to be in the $65.0 million to $68.0 million range.
