Transcript Kiwibank PPoint template JUNE12

MEDIA
BRIEFING
Financial Results – 30 June 2012
Topics Covered

Key Achievements

Profit Performance

Balance Sheet Growth

Key Ratios

Capital Adequacy

Credit Quality

The Future
2
Key achievements

Profit after tax of $79.1m for the year ended 30 June
2012, a 276% increase on previous year’s profit of
$21.2m

Continued growth in balance sheet since June 2011:


Lending increased 8% from $11.5bn to $12.4bn

Customer
$11.6bn

Customer growth continued and now exceeds 800,000
deposits
Celebrated 10 years
Shore, March 2002
increased
since
9%
launch
from
in
$10.6bn
Albany,
to
North
3
Key achievements continued
Purchase of Gareth Morgan Investments (by Kiwi Group
Holdings Ltd).



GMI manages more than $1.5 billion of funds
Adds $650 million to Kiwisaver funds
Looking to consolidate the two Kiwisaver funds later
this year
4
Key achievements continued

Kiwibank’s credit rating confirmed as AA- by Standard
and Poor’s

Rating amended from stable to negative following rerating of New Zealand Post



‘AA’ Fitch rating granted in June 2012; outlook stable

Continued support of the Kiwibank New Zealander of the
Year and local heroes
Aggressive promotions in a static home loan market
Great success with one-year fixed
(required more staff on the phones)!
rate
of
4.99%
5
Awards and achievements

Bank of the Year (Canstar and SST)

Best Value Bank (Canstar and SST)

First-Home Buyer Award (Canstar)

Highest level of customer satisfaction (Roy Morgan)

Most trusted bank brand (Reader’s Digest)
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Financial Performance – Profit &
Loss

Kiwibank substantially increased net interest income and reduced expenses
resulting in profit after tax rising 276%
30 June 2012 30 June 2011
Dollars in millions
% growth
Net interest income
257
191
Other income
162
162
Total operating revenue
419
353
19%
(308)
(321)
(4%)
Profit before tax
111
32
247%
Income tax expense
(32)
(11)
79
21
Total expenses
Profit after tax
276%
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Financial Performance-Historical
Summary
Dollars in millions
Financial performance
Interest income
Interest expense
Net interest income
Other income
Total operating revenue
Operating expenses
30 June 2012
30 June 2011
30 June 2010
30 June 2009
30 June 2008
773
720
564
649
559
(516)
(529)
(430)
(485)
(444)
257
191
134
164
115
162
162
168
149
123
419
353
302
313
238
(273)
(242)
(219)
(215)
(179)
(35)
(79)
(18)
(14)
(4)
111
32
65
84
55
(32)
(11)
(19)
(20)
(18)
79
21
46
64
37
Impairment allowances
Net profit before taxation
Income tax expense
Net profit after taxation
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Financial Performance-Balance sheet
 Lending growth continues despite slowdown in the
housing market
 Strong depositor support continues to maintain retail
funding ratio
30 June
30 June
Dollars in millions
Assets
Loans and advances
Wholesale & other assets
Total assets
Financed by:
Liabilities
Customer deposits
Securities issued & other
liabilities
Total Liabilities
Shareholder's equity
Total liabilities and
shareholder's equity
2012
2011
% growth
12,445
2,300
14,745
11,495
2,380
13,875
8%
11,565
10,586
9%
2,433
13,998
2,681
13,267
6%
747
608
23%
14,745
13,875
6%
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Financial Performance (key ratios)
Ratios in percentage terms
30 June
2012
30 June
2011
1.8%
1.5%
11.7%
3.5%
65.1%
68.5%
1.9%
1.9%
11.3%
11.0%
Profitability measures
Net interest inc./average total assets
Net profit after tax/avg shareholder's
funds
Efficiency measures
Operating expenses/total income
Operating expenses/average total assets
Capital ratios
Total capital ratio (Pillar 1)
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Financial Performance-Capital
Adequacy
 Total Capital ratio under Basel II is 11.3%
compared to
RBNZ’s minimum regulatory capital ratio of 8%

Total capital increased by $48m to $785m, a 7% increase
from 30 June 2011.

$50m share capital injection by
business growth in December 2011
NZ
Post
to
support
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Credit Quality (Impaired Assets)

The table shows total
impaired assets as a % of
gross loans and advances
from Disclosure Statements
dated 30 June 2011.
Kiwibank remains favourably
placed against other banks

The ratio has remained
consistent across strong
balance sheet growth as a
result of targeting low LVR,
seasoned (i.e. existing,
switching) customers to
maintain the quality of our
lending book.

Impaired Assets of $84m
include all assets where
interest charges have been
suspended and a specific
provision has been raised.
Down from $106m in 2011.
Bank
Kiwibank
ASB
BNZ
Westpac
ANZ/National
30 June 30 June
2012
2011
0.67%
0.92%
0.65%
1.29%
1.59%
2.13%
Source: 30 June 2011 Disclosure
Statements.
30 June 2012 not yet available.
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Credit Quality
Credit Provisions as a % of Gross Loans and
Advances
30 June


A key focus from
management and RBNZ is
the total credit
provisioning to gross
loans and advances
Each bank has a different
product and risk
portfolio to Kiwibank
which has a high %
secured mortgage book and
LMI insurance for assets
over 80%.
Bank
Kiwibank
ASB
BNZ
Westpac
ANZ/National
2012
0.73%
30 June
2011
0.76%
0.46%
0.94%
1.25%
1.39%
Source: 30 June 2011 Disclosure
Statements.
30 June 2012 not yet available.
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The future

Roll out of new shops layouts for Post and Kiwibank
following pilot in Kapiti


Continued focus on helping customers switch to Kiwibank

Growth opportunities
Bancassurance

Consolidate market position as a bank of national and
strategic importance

Continued growth of Kiwisaver
Push harder to increase
medium enterprise market
in
market
the
share
in
insurance
small
business
and
–
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