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Suncorp Group has delivered a modest profit while acknowledging that its mortgage business has performed below target.
The group achieved a profit margin of 4.5 per cent for the 12 months to 30 June 2014 – up from 3 per cent the year before.
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That came after revenue rose 1.1 per cent to $16.4 billion and net profit grew 48.7 per cent to $730 million.
Suncorp Bank’s net result jumped by 166.5 per cent, with a $343 million loss turned into a $228 million profit.
Retail and business lending climbed 5 per cent to $49.8 billion, with housing representing 78 per cent of that lending.
Suncorp said that 5 per cent result was “slightly below target”.
“It reflects a considered approach to lending in an intensely competitive mortgage environment and challenging agribusiness trading conditions,” Suncorp said.
“Retail and business lending growth of 5 per cent reflects the bank’s conservative approach and a focus on the ‘below 80 per cent’ LVR market.
“This growth was supported by a retail deposit-to-lending ratio of 65.8 per cent, well within the target range of 60 to 70 per cent.”
Suncorp also said that many customer use brokers to select home loans, so it was important to ensure that bank products could be easily accessed and fulfilled.
“We continue to enhance our broker proposition and this year introduced a service guarantee, demonstrating our confidence in consistently delivering genuine service, support and responsiveness to brokers,” it said.
[Related: Suncorp Bank increases commissions]
