Heartland sticking to forecasts
Heartland Bank is sticking to its forecasts for annual profit to rise by up to 13 per cent as credit growth and improving asset quality bolster the lender’s books, but is eyeing increasingly volatile global financial markets.
Chief executive Jeff Greenslade, who’s led the lender since Marac Finance was carved out of Pyne Gould Corp in 2011 and merged with the Canterbury and Southern Cross building societies, told shareholders at yesterday’s annual meeting in Auckland the bank was still confident net profit will be between $65 million and $68m in the year ending June 30. next year.
It sees asset growth continuing in the year’s first three months, while cheaper wholesale funding has offset more competition for retail deposits.
Heartland focuses on highermargin consumer lending, such as auto-loans and reverse mortgages, and online lending channels including peer-to-peer lender Harmoney, leaving residential mortgages to the likes of the Australian-owned banks.
It has been developing its digital strategy, which Greenslade described as transacting online.
That also opens opportunities in using data to identify risks and opportunities, and Heartland is getting analytical tools to streamline credit decisions and improve prediction.
Heartland wants to raise $59m from shareholders via a discounted rights issue which opens later this week. The shares will be sold at $1.70 apiece, which was a 9.5 per cent discount to the theoretical ex-rights price of $1.88 when it was announced this month.