ME's chief executive has called for more regulatory changes to “level the playing field” among Australian mortgage providers.
Jamie McPhee says further changes are required this year to ensure a level playing field between regional and major banks, “including the amount of capital held by the advanced model bank”.
Mr McPhee made the call yesterday as he unveiled ME's half-year profit results.
ME saw its net interest income jump by 9 per cent in the six months to 31 December 2015. It said recent rate hikes would lift its net interest margin in 2016.
The non-major reported an after-tax underlying net profit of $30.2 million for the six months ended 31 December 2015, a rise of 8 per cent on the previous corresponding period.
Mr McPhee said it was a strong result in challenging conditions and the bank was expecting further profit growth in the second half of the year.
“Net interest margin in the next six months will benefit from recent rate increases following regulatory capital changes imposed on the banking sector, although this will be partially offset by the increased cost of funding that is putting current margins under pressure,” he said.
The non-major’s brand awareness jumped 11 points to 51 per cent since the bank rebranded in July 2015, the highest level the bank has recorded, with customer numbers growing to 347,000.
Net interest income increased 9 per cent to $149.3 million and total operating expenses increased 7 per cent to $133.2 million, the latter reflecting the ongoing investment in technology and the brand.
Meanwhile, ME’s new mobile app, which launched in July last year, has increased mobile-based transactions threefold.
“The bank is close to finalising the technical infrastructure to display industry super member balances on its online and mobile banking platforms through a joint partnership with Link Group,” ME said.
The bank said initiatives with industry super funds contributed significantly to customer and home loan growth, including a new program that directly markets exclusive offers to partner members.
[Related: ME names new chairman]