Industry super fund-owned bank ME remains on a strong growth path, with the non-major lender announcing a healthy profit increase across the 2016 financial year.
Figures released this week by ME revealed a net profit after tax (NPAT) of $74.7 million for FY2016, up 29% compared to FY2015’s $58.1 billion.
The FY2106 result means ME’s NPAT has increased by an annual compound growth rate of 32% since 2012.
Jamie McPhee, ME chief executive officer, said internal changes had played a key role in the profit increase and the bank is well positioned for future expansion.
“Growth has been achieved by improving systems and processes, increased brand awareness and digital capability, and a deeper relationship with our industry super fund partners,” McPhee said.
“We are meeting our financial objectives while delivering strong growth which, combined with ongoing investments in brand and technology, are positioning the Bank for even greater growth going forward, ensuring we deliver long-term strategic value and appropriate financial returns to our industry super fund owners,” he said.
ME’s home loan book also contributed heavily to the FY2016 result, with the bank settling more than 16,000 new home loans totalling $4.6bn over the year. $2.6bn of that came in the second half of the year, a record mark for ME.
Lino Pelaccia, ME general manager of broker sales, recognised the role the bank’s broker network had played in meeting that milestone.
“Despite only entering the broking market five years ago, this distribution channel already provides over half ME’s home loans,” Pelaccia said.
“Brokers are critical to ME’s growth plans and ME continues to add to its broker service,” he said.
Pelaccia said ME has recently implemented stronger support structures for its broker network and along with a refreshed product offering will soon launch a new online broker portal.
“We’ve also refreshed our home loan pricing structure based on LVR and loan-size, effectively tripling our pricing options and making us competitive across all market segments, and helping to stabilise application volumes,” he said.
“Our most important service change will happen in the second half of this Financial Year, when we launch our new online broker portal, which will let brokers access clients’ home loan accounts so they have more control and information about clients, both pre and post-settlement.”