ING Bank has indicated that it will maintain its 'prudent' approach to mortgage lending in an effort to remain a competitive alternative as Australia's fifth largest home lender.
In its annual report for 2011 released today, ING Bank said its mortgage portfolio increased just 2% or $0.7bn in 2011, with a total of $37.4bn in its portfolio as at 31 December 2011.
The growth falls well short of "aggressive expansion" targets made early in 2011 by executive director of delivery Lisa Claes, that the bank would increase mortgage production by 20%.
Overall, the bank delivered a net profit after tax of $304.3m for the year, a record profit for the bank and an increase of 10% on the previous calendar year result of $275.9m.
ING said the mortgage portfolio demonstrated "strong credit quality", with arrears and default levels performing "in line with or better than" industry benchmarks.
"The bank is committed to a prudent approach to the residential mortgage market whilst remaining a significant competitor," ING Bank said in a statement.
ING referred to its continued investment in residential mortgage capabilities, including providing third party brokers direct access to credit assessors to enhance their experience.
CEO Don Koch said 2011 was a year where the bank's balance sheet was strengthened, underpinning plans for long-term growth in the Australian market.
“We saw very strong growth in business deposits reflecting a strong desire of SMEs to look beyond the big four. We also continued to diversify our funding mix which is a key plank to facilitate future growth."
The business managed $2.8bn (12%) growth in its deposit book in a "highly competitive savings market" during the calendar year, with a total savings portfolio of 26.1bn.
ING said it was well positioned despite continued global economic ructions centering on Europe.
"Globally, 2011 has seen significant challenges placed on financial institutions, particularly in Europe. ING Group is well positioned to succeed in this environment with a strong capital base and conservative funding mix."
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