The run-down in RHG's mortgage portfolio over the past year resulted in a 26% fall in earnings in the year to June 2013, according to Banking Day reports.
RHG’s board is currently considering competing takeover offers and yesterday reported a net profit of A$30.3m for the 12 months to June – down from $40.7 million in the previous corresponding period.
The company manages the remnants of what was the Rams Home Loans' mortgage portfolio. The value of the book fell from $2.8 billion at the end of the 2011/12 financial year to $2.1 billion at the end of June.
The arrears rate stood at 4.25%, while the individually assessed provision for ‘bad and doubtful’ debts was $4.1 million and the collective provision was $1.4 million.
RHG’s board has entered into a merger implementation deed in respect of a proposal by a syndicate led by Resimac to acquire all of RHG's share for 48 cents a share. The bid values RHG at $148.1 million.
The directors have not yet determined whether a competing offer from a syndicate led by Pepper Australia is superior and the Resimac syndicate has the right to submit a counter offer.