Cooperative Bank lifts annual profit 24% on expanding loan book, fatter margins
By Paul McBeth
May 29 (BusinessDesk) - The Cooperative Bank, formerly known as PSIS, lifted annual profit 24 percent for a second year
as it continued to expand its loan book, reduce bad debts, and fatten margins.
Net profit rose to $8.9 million in the 12 months ended March 31 from $7.1 million a year earlier, the Wellington-based
lender said in a statement. Net interest income climbed 14 percent to $48.8 million, with net interest margins widening
to 2.88 percent as at March 31 from 2.76 percent a year earlier, fatter than those of the major Australian banks which
reported first-half earnings earlier this month.
The Cooperative Bank trimmed impairment charges on bad loans by 32 percent to $1 million, while expanding its loan book
11 percent to $1.56 billion, and its customer deposits by 12 percent to $1.57 billion.
The lending and deposit growth "reflects our consistent approach to pricing, setting the bank apart from its competitors
who have tended to drift in and out of the market with aggressive pricing as it has suited them," chief executive Bruce
McLauchlan said.
New Zealand's major lenders have been fighting for market share in the residential market, with Auckland's housing
shortage and increased demand fuelling demand for mortgages. To try and rein in some of that exuberance, the Reserve
Bank recently announced plans to impose high-leverage lending to property investors in the country's biggest city, which
has been driving about a third of new loans.
The Cooperative Bank today said it added another 12,000 customers in the past year, and will pay $1.8 million in rebates
to its customers for the 2014/15 financial year, up from $1.3 million a year earlier. The old cooperative structure the
bank operates under means it shares its profits with customers, something it touts as a competitive advantage in
attracting long-term customers.
(BusinessDesk)