Mortgage business logo

Credit union records resi lending growth

The credit union’s full-year results have revealed that growth in its total loan book has boosted its net profit before tax.

People’s Choice Credit Union has recorded a 3.93 per cent increase in residential lending for the 2019-20 financial year period to $7.4 billion, which it said was 1.5 times the industry average.

In its full-year results, the credit union said this increase in residential lending led to a 2.88 per cent increase in total member loans and advances, which stood at $7.9 billion.

The growth in the loan book has resulted in an improvement in net interest margin, which has led to a 12.2 per cent growth in comparative net profit before tax of almost $54.0 million.

Statutory net profit increased by 5.4 per cent to $22.2 million, with People’s Choice reporting an additional $9 million expense relating to technology transformation when compared with the prior year.

A total of $7.2 million in costs related to the coronavirus pandemic were incurred during the reporting period, which related to increased credit provisioning, staffing needs and regulatory requirements.

Total member deposits rose by 6.39 per cent to $6.6 billion, and the organisation’s total assets increased by 7.23 per cent to $9.4 billion.

md discover

Commenting on the results, CEO Steve Laidlaw said that since the onset of COVID-19, the credit union has provided hardship assistance to almost 3,000 members.

“When our phone and online inquiries doubled almost overnight, we put additional resources into our national contact centre to ensure member calls were answered promptly,” Mr Laidlaw said.

“Our financial planning team also increased their workload by approximately 50 per cent to support clients.”

The organisation reported an investment of $43.1 million, with $15.6 million allocated to operational expenses and $27.5 million allocated to capital expenditure across the financial year in areas such as technology enhancements.

“That was not something we were willing to delay,” Mr Laidlaw said.

“We are making excellent progress in transforming our technology and operating model to support many members’ expectations of being able to do all their banking digitally if they wish,” he said.

[Related: Bulk of deferral customers restart payments: CUA]

Share this article

Join Australia's most informed brokers

Do you know which lenders are providing brokers and their customers with the best service?

Use this monthly data to make informed decisions about which lenders to use. Simply contribute to the survey and we'll send you the results directly to your inbox - completely free!

brokerpulse graph

What are the main barriers to securing a mortgage at the moment?