The Kiwibank Banking Group (“Kiwibank”) made an after-tax profit of $97.1 million for the year ended June 30 2013, an increase of 22.8 per cent over the previous year’s profit of $79.1 million.
In the last year, Kiwibank:
o Increased loans and advances by 6.5% from $12.4 billion to $13.2 billion
o Increased customer deposits by 4.3% from $11.6 billion to $12.1 billion
Kiwibank Chief Executive Paul Brock said that over the last year “there has seen a continued strong recovery from the impact of the Global Financial Crisis and the impact of the Christchurch earthquakes”.
He said there has been significant reduction of the bank’s provisioning for bad debts. Total provisions for impairment losses stood at $72m as at 30 June 2013, compared to $91 million at 30 June 2012.
Kiwibank continued to be a strong performer in the bank deposit market and customer deposits accounted for 84% of all bank funding.
Kiwibank raised $150m of term subordinated debt during the year (in December), the first issue of Tier 2 qualifying securities in New Zealand under the Reserve Bank’s new Basel III rules. This was followed by Kiwibank’s inaugural covered bond issue in April. The CHF 150m deal was sold to Swiss investors following a successful roadshow.
In October 2012, Kiwibank’s credit rating was revised from AA- to A+ by international credit rating agency Standard & Poor’s. The accompanying outlook was initially stable, but downgraded to negative late in the financial year. The credit rating reflects the rating for New Zealand Post Group.
Again the year was characterised by a static home loan rate market with no changes to the Official Cash Rate.
Kiwibank and New Zealand Post continue to make progress on the project to enhance the look and service levels of the retail network and are well advanced with the transformation of the first group of shops on Auckland’s North Shore. A three year programme will change how both New Zealand Post and Kiwibank interact with customers.
Kiwibank continues to target growth in the personal retail banking market and is making strong growth in the SME (small and medium enterprise) business banking sector. It is placing significant emphasis on the quality of its lending in this sector.
Mr Brock said Kiwi Insurance has had another excellent year as it transitions to a full in-house manufacturing capability.
“The journey for the year culminated in receiving a full licence from the RBNZ under the IPSA. Other milestones included receiving an A- (Excellent) rating from AM Best.,” Mr Brock said.
Particular highlights for Kiwibank in Canterbury are the rapid improvement in lending volumes and market share.
“Residential lending performance has significantly improved. The Canterbury region for Personal Markets drawdown volumes continued to accelerate hitting a new bank peak in June. Growth in lending at Kiwibank in Canterbury now exceeds the estimated pre-quake growth rates with a clear re-emergence of consumer lending demand following contraction in the asset base over the 2011/12 financial year. “
Prestigious international finance magazine, Global Finance, named Kiwibank as best bank in New Zealand for 2013. The bank also won the Sunday Star-Times Bank of the Year Award, the Canstar First-Home Buyer Award (for the 3rd year in a row), the Canstar Best Value Everyday Banking Award, the Reader’s Digest Most trusted bank brand, and had the highest level of customer satisfaction (Roy Morgan).
Kiwibank is rated as being among the top 25 banks in the world for security and safety.
For further information:
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