Two new branches planned, as Heritage posts 12th consecutive year of record profit
Heritage Building Society plans to open two new branches this financial year as it targets growth after announcing a 12th consecutive year of record pre-tax profit in 2010/2011.
Heritage today announced a before tax profit of $43.89 million for the year ended 30 June 2011. This strong result represents a 3.7% increase over the previous year. Significantly, the before tax profit for the six months to June 30 was $23.92 million, up almost 20% on the $19.97 million recorded in the first half of the financial year.
The after tax profit for 2010/11 was $32.06 million, an increase of 7.2%.
Heritage also edged past the $8 billion milestone, with total consolidated assets increasing by 6.3% to $8.04 billion. This reinforced Heritage’s position as Australia’s largest building society.
In announcing these pre-audit figures, Heritage Chairman Mr Brian Carter said few financial institutions anywhere in the world could boast such sustained and strong financial results, especially in a period spanning the GFC.
“Heritage is an extremely strong, well managed and reliable performer which delivers great value for its members. It’s no accident that we continue to post such strong economic results, year after year.”
Heritage achieved an increased capital adequacy ratio of 14.14% and a solid liquidity ratio of 18.88% as at 30 June 2011, well above regulatory requirements.
Total loan approvals in 2010/11 were $1.359 billion, an increase of 2.8%. Retail deposits grew by $352 million, a 10.6% increase.
Mr Carter said Heritage had moderated its growth in the years following the GFC but would target a steeper growth curve this financial year.
“We have consolidated our position in recent years and still maintained substantial growth.
“Last month we finalised an $800 million securitisation issue, the largest domestic transaction in Heritage’s history and the first for five years. That has helped shore up our funding requirements, positioning us to pursue mortgage lending more strongly this year, both through branches and the mortgage broker channels.
“We plan to open two new branches this year in Queensland, as part of our strategy for growth and broadening our member base. The exact locations of the branches are yet to be finalised but these new outlets will help us stimulate continued growth into the future.”
Heritage CEO John Minz said that solid financial performance had been delivered while also achieving enviable levels of customer satisfaction.
“Heritage’s People first philosophy is the foundation on which we will continue to grow and be successful. We measure our performance not just in pure financial terms but in the value we deliver to our members.
“I’m very proud that Heritage has just notched our 14th consecutive month with the highest customer satisfaction rating of any financial institution in Queensland, according to independent Roy Morgan Research.1
“Our members love the overall package they receive from Heritage, from our competitively priced products and fairer fee structures to the outstanding customer service we provide.
“Our People first approach applies to our staff as well as our members, and that was reflected by Heritage taking out the Recommended Employer title at this year’s 2011 Australian Business Awards.”
Mr Minz said Heritage’s continued low mortgage arrears rate was a major achievement given the summer of natural disasters that has just occurred.
“The Society’s mortgage loan arrears greater than 30 days sat at just 0.40% at 30 June, which is an extremely low rate that is far below the industry average” he said.
“To achieve that against the backdrop of floods, cyclones and other natural disasters is testimony to Heritage’s prudent approach to managing its loan book.”
1 Data according to Roy Morgan Research monthly Customer Satisfaction (Queensland only) – Consumer Banking in Queensland report for 14 month period up to and including May 2011