Heritage Bank delivers $41 million benefit for customers

Banking with Heritage Bank, instead of one of the big four, saved customers more than $41 million in 2014/15 – a tangible demonstration of the value that customer-owned institutions deliver, Chairman Mr Kerry Betros said today.

Mr Betros told today’s Annual General Meeting that Heritage Bank’s customer-owned model delivered an outstanding overall banking experience.

“Independent research by analysts Canstar found that in 2014/15 our customers were more than $41 million better off by banking with Heritage rather than the big four banks,” he said.

“We also ended the financial year with a Roy Morgan main financial institution customer satisfaction score of 93.5% - almost 10% higher than the average score of the four big banks in Queensland.

“We deliver a better financial outcome for customers and a more satisfying experience. We don’t take profits from the pockets of customers and pay them out to shareholders.

“The customer-owned banking model that Heritage represents provides an outstanding result for customers. We offer a hugely important and valuable alternative in the Australian banking sector. The only problem is that too few people realise just what they’re missing out on.”

Mr Betros said Heritage had reported another year of solid results in 2014/15. The pre-tax profit was $48.01 million, a 4.1% decrease on the previous year. This profit result was constrained to a degree by a significant investment program Heritage is currently making in digital technologies, both customer-facing and back office

Loan approvals increased significantly, up 27.6% to a total $1.838 billion. Heritage also grew its total consolidated assets marginally to $8.557 billion, confirming its standing as Australia’s largest customer-owned bank.

Mr Betros told the AGM that the massive shift to online banking was making fundamental changes to the sector. Heritage has responded with a five-year investment strategy to upgrade online and mobile banking services, improve data systems, and simplify processes.

“This investment in transforming our business for the digital age is non-negotiable – we must make these changes to stay relevant to our customers,” Mr Betros said.

Mr Betros also said that today’s AGM would be the final one for outgoing CEO Mr John Minz, who retires on 19 November after 22 years at Heritage, including the last 12 as CEO.

“I would like to acknowledge the enormous contribution that John Minz has made to Heritage Bank. He has strengthened not only the financial position of Heritage but also the culture and values of the organisation,” Mr Betros said.

“We were also delighted to announce recently that senior banking executive Mr Peter Lock had been appointed to take up the CEO role.

“Mr Lock has extensive experience in the sector and will fit the Heritage culture perfectly.

“We’re looking forward to continuing to grow and prosper under his leadership into the future.”

Mr Lock takes up the new role on Monday, 23 November.

* Home loan comparison rate based on a $150,000 loan over 25 years.  Fixed loan comparison rate applies only for loans with an LVR of 80% or less and a loan amount of $150,000 to $249,999.  WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.

Interest rates are on a per annum basis. Rates are correct as stated and subject to change without notice. Rates shown are for new loans and do not apply to switches or internal refinances.

Home Advantage Variable rates include discounts shown from the Standard Variable rate. Home Advantage Living Equity rates include discounts from the Living Equity rate. Discounts are based on total lending in the package. Discount Variable LVR rates are for new lending and include discounts from the Discount Variable Loan Rate.  Discounts are not available in conjunction with any other interest rate discount or special offer. All fixed rates are fixed for the period stated and revert to the variable rate applying at expiration of the fixed term. To approved applicants only. Conditions, criteria and fees apply.

Loan to Value Ratio (LVR) is the loan amount divided by the value of your security property (determined by Heritage Bank at assessment), multiplied by 100. Owner Occupied loans have a maximum LVR of 95%, Investment loans have a maximum LVR of 80% and Living Equity has a maximum LVR of 80%. Heritage is not accepting any new investment applications until further notice.

This advice has been prepared without taking into account your objectives, financial situation or needs. Because of this you should, before acting on this information, consider its appropriateness having regard to your objectives, financial situation or needs.

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