Great Southern Bank boosted by FHB rise

The mutual bank saw its total loans increase by 0.9 per cent in FY21, up to $16.3 billion.

The home lending portfolio had leapt by 24.5 per cent year-on-year, up to $13 billion. New home loans for FY21 came to $3.2 billion.

Following investments in a new system and joining the Finsure lending panel, around 62 per cent of the bank’s loans came from brokers, up from 56 per cent in FY20.

Great Southern Bank had also seen a surge in first home buyers, with the demographic covering one-third of its home loan applications – three times more than in 2018.

“Improving our broker service has helped introduce a young demographic to Great Southern Bank, with broker customers on average seven years younger than ones introduced through our branches,” a spokesperson for the bank told Mortgage Business.

Paul Lewis, chief executive of Great Southern Bank noted the bank had accelerated its application approval processes, with a technology roll-out that reduced its average turnaround time to one day.

The move saw home loan applications increase by 31 per cent over the year.

“We’re also keen supporters of government schemes to help with home ownership – through the First Home Loan Deposit Scheme alone we’ve helped over 1,700 Australians purchase their first home with a total lending exceeding $525 million,” Mr Lewis said.

The bank is also participating in the Family Home Guarantee Scheme, allowing eligible parents to buy a home with a 2 per cent deposit.

Looking at its overall result, Great Southern Bank posted a group net profit after tax of $49.1 million for FY21, crediting strong revenue growth, lower funding costs and clear strategic direction.

During FY21, the bank rebranded from its former name, CUA (Credit Union Australia), and declared that it would be divesting its health insurance business while prioritising home lending.

“We saw strong growth in the second half of FY21 and have set ourselves up well for growth opportunities over the next three years,” Mr Lewis said.

“Our goal is to leverage attractive opportunities as they arise and continue to increase our already high customer service ratings.”

Meanwhile, total income for the group rose by 9.6 per cent to $328.3 million in FY21.

Operating expenses came to $255.8 million, 11 per cent more than in FY20, including $4.5 million in one-off costs relating to the sale of health insurance business CUA Health.

Risk and compliance took up the bulk of expenses, with investments in open banking and greater anti-money laundering capability.

Retail deposits increased by 1.6 per cent to $11.2 billion, as combined banking and insurance customers increased by 2.3 per cent to 420,329.

“We can achieve further significant cost benefits and efficiencies for our customers by increasing scale and efficiency,” Mr Lewis said.

“We are well placed to seek growth opportunities which we are exploring through partnering, acquisitions or other forms of collaboration.”

The health insurer business, CUA Health, contributed $9.3 million to the group’s NPAT, up from FY20’s $6.1 million.

The sale of CUA Health to HBF is expected to wrap up by the end of the month.

[Related: APRA watches for lockdown impact on mortgage rise]