Auswide Bank (MYS) H2 2024 earnings summary

Executive summary

• Statutory NPAT for FY24 was $11.2 million, down 55.2% year-over-year, with underlying NPAT at $10.3 million, reflecting margin compression and higher funding costs.

• Net interest margin (NIM) compressed to 1.42%, down 46bps from FY23, due to intense competition and deposit migration.

• Customer deposits grew 8% to $3.686 billion, now 75.3% of total funding, supporting a strong balance sheet.

• Strategic focus included digital investment, customer experience, and inorganic growth through the MyState merger and Selfco acquisition.

• Final dividend declared at 11.0c per share, with a 96% payout ratio, subject to acquisition completion.

Financial highlights

• Net interest revenue declined 20.1% year-over-year to $71.3 million due to NIM compression and higher funding costs.

• Operating expenses increased just 1% year-over-year, excluding expected credit losses.

• Loan book growth was subdued at 0.6%, reaching $4.429 billion, with annualised growth of 5.5% in 2H FY24.

• Return on equity fell to 3.9% from 8.7% in FY23.

• Statutory EPS dropped to 24.2c from 55.6c, and total dividend per share halved to 22.0c.

Outlook and guidance

• Home loan growth targeted to exceed $300 million in FY25, with material uplift in interest revenue as fixed rate loans mature and reprice to higher market rates.

• Focus on quality lending, prudent underwriting, and new deposit partnerships.

• Cost base expected to grow 6%-7% in FY25, with synergies from Selfco and MyState merger anticipated.

• Continued investment in fraud management, cyber resilience, and data risk management.

• Loan book is positioned to benefit from macroeconomic tailwinds in Queensland.