Media Release

Strong home loans buoy Teachers Mutual Bank 2014 Results

Teachers Mutual Bank’s 2014 home loan portfolio has experienced strong growth of 11.44% and has again outperformed the bank average, this year by 51%*. The mutual bank’s robust home loan performance has remained consistent, coming off the back of an increase of 8.95% in 2013. 

Having made a highly successful entry to the mortgage broker channel in FY 2014, CEO Steve James attributes some of the home loan result to broker-generated loans. 

“Our entry to the broker home loan channel has gone exceptionally well, and contributed in part to our very sound performance in home loans. With fifty per cent of Australian home loans facilitated by brokers, we can now serve more members and potential members for their mortgage needs.” 

Ninety two per cent of Teachers Mutual Bank’s loan portfolio is home loans. The mutual bank’s net profit after tax (NPAT) was $25.8 million, down 8.16% from $28.1 million in 2013. Factors influencing the small profit decrease included the abolition of some transaction fees, a fall in interest rates, and continued capital investment in IT systems and product development. 

“The mutual bank continues to invest in new and innovative products, and this year introduced a highly competitive mortgage offset facility, with the rare feature of being available across all home loan products,” said Steve James. 

“We are steadily building our credit card portfolio, which grew by 1.86% in FY 2014, more than three times the banks’ average of 0.5%*.” 

Total loan growth in 2014 was a robust 9.86%, also well above system. Impairment costs, despite provisions increasing on the previous year, were still at a low $2.75million, an enviable result in the context of the wider banking industry. Teachers Mutual Bank’s asset base grew by 7.48% to $4.4 billion. Capital adequacy ratio remained strong at 15.72% and well beyond prudential requirements, with capital reserves continuing their year on year increase to stand at $365 million. 

“In 2015 we’ll be continuing our journey of strong growth, product development, prudent lending and exceptional loan quality,” said Steve James. 

“While achieving healthy profits, we were also honoured this year to be recognised at an international level by the Ethisphere Institute as one of the World’s Most Ethical Companies. Ethical business practices and sustainability are at our very heart,” said Steve James. The Teachers Mutual Bank Annual Report can be found at www.tmbank.com.au/annualreport. 

Contact: 

Gillian Tatt, PR and Corporate Affairs Specialist, Teachers Mutual Bank on 0448 259 942 or 02 9735 9825.  *source: APRA’s monthly banking statistics