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Strong loan growth despite unhelpful market conditions, coupled with a solid profit outcome, were the standouts in Heritage Bank’s half-year financial results

1 March 2019

Strong loan growth despite unhelpful market conditions, coupled with a solid profit outcome, were the standouts in Heritage Bank’s half-year financial results, CEO Peter Lock said today.

Loan approvals were $963.53 million in the six months to 31 December 2018, up 20.31% from the $800.88 approved in the same period the previous year.

Net loan growth for this six-month period was $164.85 million, up 271.61% on the $44.36 million recorded in the comparable period in 2017

Heritage reported a solid after-tax profit of $25.15 million in the six months to 31 December 2018. This was down 4.26% on the $26.27 million after-tax profit recorded for same period in the previous year, however that 2017 half-year period featured an exceptionally strong profit result.

The $25.15 million half year profit to December 30 was well up on the $17.77 million after-tax profit recorded in the immediately preceding six months to 30 June 2018.

Heritage also recorded excellent retail deposit growth of $192.30 million in this six-month period, up 56.55% from $122.84 million in the comparable period in 2017.

Mr Lock said the profit result reflected Heritage’s determination to deliver for its customers.

“This was a very solid profit outcome for our customers, driven by disciplined expense management and effective capital allocation decision-making,” Mr Lock said

“Our business is strong, and we have also been able to provide customers with great value, great products and great service. That’s what a customer-owned bank is all about. 

“We have also managed to secure a significant uplift in loan volumes, despite difficult market conditions characterised by falling property prices in certain geographies and a slow-down in credit growth across the banking sector.

“That’s a credit to the fantastic work of our staff, and is evidence that the people-first philosophy which drives Heritage also resonates with customers.


“It’s why Roy Morgan recently awarded us the 2018 Customer Satisfaction Bank of the Year title, ahead of all other banks in Australia. That’s a strong endorsement of the value that Heritage Bank has to offer.

“The ongoing commitment to our customers and our branch network is reflected in our ability to attract consistent growth in retail deposits.”

Mr Lock said the results helped maintain a strong strategic outlook for Heritage.

“We’ve achieved excellent half-year results while continuing to drive an ongoing transformation program and to invest in upgrading our core capabilities,” Mr Lock said

“We’ve improving and updating our technology platforms to better cater for the banking needs of today’s customers.

“Our balance sheet is now well positioned to enable us to move forward with the next phase of our transformation program.”

Heritage recorded a capital adequacy ratio of 14.48% and a liquidity ratio of 14.85% as at 31 December 2018, both an increase from the result at 30 June.

Total consolidated assets increased from $9.524 billion at 30 June to $9.750 billion at 31 December.

Chairman Mr Kerry Betros said the results set an excellent platform for Heritage to push forward with its strategic goals.

“Customer-owned institutions such as Heritage face the ongoing need to balance our prudential capital requirements, our growth ambitions and our profit requirements,” Mr Betros said

“These results show our capital and liquidity levels are at robust levels.

“We’ve been able to achieve growth in our underlying capital, at the same time as we rebuilt momentum in the balance sheet, which was a great result.

“Our mortgage arrears rate is up slightly, but remains well below market levels and does not show any concentration of issues in any particular area.

“We will continue to pursue our strategic objective to attract more customers to enjoy the advantages that come from banking with customer-owned organisations such as Heritage.

“We hope that the revelations at the Hayne Royal Commission of poor practices at the big banks will open people’s eyes to the value of the customer-owned option as a genuine alternative.

“We offer a proven banking model that’s safe and secure while also giving customers better value and a more satisfying banking experience.

“There is no conflict for us in who we serve – customers always come first.” 





Six months to

Six months to











$ million

$ million






Profit before tax
















Profit after tax












Loan approvals












Net loan growth












Retail deposit growth











Table 2









Total consolidated assets

$9.524 billion

$9.750 billion







Capital adequacy ratio









Liquidity ratio









Mortgage loan arrears







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