Building society Newcastle Permanent has delivered a net profit after tax (NPAT) in excess of $40m, with growth in its loan book a key contributor to the result.
Figures from Newcastle Permanent show it generated an NPAT of $40.9m over FY2016, with its home loan portfolio growing 11.5% to $7.86bn over the year, with just 0.13% of those loans being in the 90+ days in arrears category.
In the 12 months to June, the building society refinanced more than $671 million in home loans from the major banks, while retail deposits grew by 9.9% to $7.07 billion.
Terry Millet, Newcastle Permanent chief executive officer, said the FY2016 result is especially promising for the building society given market conditions across much of the year.
“The 2015/16 period challenged all financial institutions with ongoing margin pressure caused by lending and capital regulation as well as historically low interest rates and intense competition,” Millet said.
“Our results show the strength and competitiveness of our customer value proposition, and the ongoing sustainability and relevance of our customer ownership model providing relief for customers within a market dominated by a gang of profit-hungry major banks,” he said.
While Millet said the financial result was welcome news for the building society, he said the last year has been a positive one for other reasons as well.
“One of the important markers for Newcastle Permanent is our customer satisfaction score, which remains at least 10 points clear of the best performing major bank again this year, recorded at 92.3% by Roy Morgan in June 2016,” he said.
“We refinanced more than half a billion dollars in home loans from the major banks last year, showing that customers are voting with their feet for a better way of banking with us.”
Across FY 2016, Newcastle Permanent made a $7.8m investment in projects and capital expenditure to strengthen IT infrastructure, enhance the customer value proposition and adhere to changing regulatory requirements.