It was one of 14 providers of the government's Business Finance Guarantee Scheme
Heartland Group Holdings Limited (Heartland) has survived the COVID-19 pandemic, reporting a net profit after tax (NPAT) of $87.0 million for the financial year that ended June 30, 2021 (FY2021), a $15.1 million increase on the financial year that ended June 30, 2021 (FY2020).
On an underlying basis, Heartland’s FY2021 NPAT was $87.9 million, an $11.0 million increase (14.3%) compared with the FY2020 underlying NPAT.
Moreover, the bank’s return on equity (ROE) reached 11.9% (up 144 bps from FY2020), and the underlying ROE was 12.0% (up 86 bps from FY2020). Meanwhile, its earnings per share (EPS) was 14.9 cps (up 2.4 cps from FY2020), and the underlying EPS was 15.1 cps (up 1.8 cps from FY2020).
During the COVID-19 pandemic, Heartland Bank was one of 14 providers of the government’s Business Finance Guarantee Scheme (BFGS) that provided access to funds for businesses affected by the pandemic. Its BFGS book is at $60.3 million.
The bank stated that its COVID-19 economic overlay of $9.6 million, taken in respect of FY2020, remains unutilised. In addition, the overlay does not represent any actual losses but was taken to provide a buffer against any future losses that the uncertainty of COVID-19 may give rise to. The overlay remains in place.
The COVID-19 pandemic prompted banks and other organisations to go digital – and Heartland reported that its digital strategy reached a stage of maturity during FY2021.
The bank’s digital strategy started with the front end, with online mobile platforms providing access for customers that allowed the bank to extend its reach beyond the constraints of physical distribution while reducing onboarding costs.
“These platforms have been integrated into business units as the prime means of distribution. The next stage is to create scale and take out friction, i.e., processes that cause customer inconvenience and delay,” Heartland said in its FY2021 report.