Banking and wealth management group, MyState Limited, has posted a statutory net profit after-tax (NPAT) of $14.6 million for the six months to 31 December 2012, despite challenging markets.
This included a contribution from the group's financial and insurance services integration program, 'The Rock', for the full six months, compared to only one month for the prior corresponding period.
This was an increase of 29.8 per cent over the first half of the 2012 financial year when profit was impacted by costs associated with the acquisition of The Rock. Underlying after-tax profit, excluding these costs and after other normalisation adjustments, increased by 8.8 per cent to $14.9 million.
"This result in a challenging environment demonstrates the strengths of our businesses. MyState increased its loan portfolio, despite difficult economic conditions in Tasmania and is well placed to improve its financial performance following cost reduction initiatives and the implementation of its new core banking system," MyState Limited managing director John Gilbert said.
"The Rock delivered a solid profit and is on track to achieve the cost and revenue synergies we identified at the time of the merger in December 2011. In addition, Tasmanian Perpetual Trustees increased its profit by 26 per cent due to increased investor inflows and reduced operating costs."
All three businesses improved their cost-to-income ratios, excluding restructuring costs and ongoing
cost reduction initiatives, which are expected to result in annualised pre-tax savings of $4.5 million, after implementation costs, by the end of the 2013 financial year.
The group's bad and doubtful debt expense fell by 7.3 per cent to $1.6 million.
MyState directors said the continuing uncertainty in relation to the interest rate outlook and subdued credit demand in the Tasmanian economy, present challenges for MyState Financial for the second half of the financial year.
"The Rock's profitability is expected to continue to improve due to the ongoing realisation of merger synergies and retail revenue gains. Tasmanian Perpetual Trustees is also expected to increase modestly its contribution to the group result on the back of higher fund inflows from investors," the group said.
