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At its latest MyState Limited AGM on Wednesday (19 October), the bank announced preliminary results for the first quarter of the 2023 financial year (1Q23), which confirmed its home loan book had risen +6.9 per cent on the previous quarter, to $7.3 billion.
Additionally, the Tasmanian bank’s customer deposits rose 10.1 per cent to $6.1 billion in the quarter ended September 2022, while its 30-day home loan book arrears proved steady at 0.41 per cent, considerably below industry benchmarks, it highlighted.
Among the fastest-growing banks in Australia measured by home loan book growth, Tasmania’s MyState has reported increased market share and underlying profitability.
In terms of financial performance (compared to 30 September 2021 quarter), MyState reported a net profit after tax strongly up by 41 per cent, to $9.7 million; its return on equity is improving, up 235 bps to 9 per cent; and the cost-to-income ratio continues to reduce, down 698 bps to 65 per cent, it confirmed.
Brokers at the heart of the future
“We shared in the update [MyState Limited AGM] as well that we’re targeting to grow greater than two times system over the next three years,” MyState Limited chief executive Brett Morgan told Mortgage Business.
“So [we’ll] continue to invest into growth and that growth will predominately come through the broker channel.
“We know customers are choosing brokers more and more — and, for us, our presence on the mainland is through our digital channels for our deposits side of the business, [and] brokers for our lending side of the business.
“We see brokers as being at the heart of the future given; again, consumers choosing brokers to help them through what is a difficult process.
“Our [growth] focus is east coast and we will continue to build our lending book through brokers.”
A strong home base in Tasmania
Earlier at the event, chairman Vaughn Richtor highlighted that the company delivered a statutory net profit after tax of $32.0 million for the financial year — the second highest on record — surpassed only by the previous financial year’s record $36.3 million.
The reduction was largely due to higher operating costs associated with the bank’s “… strategic investment in distribution capacity, marketing and brand building” to support its “… national growth strategy”.
“During FY22, our company continued to meet, and in many areas exceed, key goals and objectives — both financially and in terms of servicing the needs of our growing customer base,” Mr Richtor said.
“We completed the 2022 financial year in a strong position, with increased market share and sound underlying profitability.
“This investment is in line with our successful transformation to become a modern financial services company with a strong home base in Tasmania, a digital online focus and an expanding national customer base.
“The results vindicate our approach, with changes made so far making MyState among the fastest growing banks in Australia measured by home loan book growth.”
Straightforward customer-focused processes
“We increased new to bank customers by 14.8 per cent in the past financial year,” Mr Richtor continued.
“Pleasingly this included 12,827 new customers in the three eastern seaboard mainland states — testament to the success of our growth strategy in a highly competitive banking landscape.
“Key to our growth has been our ability to build partnerships with independent mortgage brokers.
“In addition, we achieved consistently fast loan approval turnaround times and enhanced our digital banking platforms — while maintaining a highly visible and accessible branch network across Tasmania.
“MyState has the foundations in place to execute an ambitious growth program where we provide the services that customers expect, career opportunities for our people and acceptable shareholder returns which can be maintained over the longer term.
“Our investment in brand, customers, digital capabilities and simple, straightforward customer-focused processes puts us in a solid position to continue to increase market share in a competitive financial services landscape.”
[Related: MyState loan book lifts $1bn]