UDC Finance posts $27.3m half year profit
20 May 2016
Media Release
UDC Finance posts $27.3m half year profit
UDC Finance has posted net profit after tax of $27.3 million for the six months to 31 March 2016, down 4% on the corresponding half last year.
The result reflected tighter margins in lending and deposits, due to increased competition, and a lift in provision expense off historically low levels.
UDC grew lending by 7% compared with the first half last year, with 6% growth over the latest half. Customer investments were stable at $1.74 billion. A focus on cost control saw total expenses fall by 3% from the first half last year and cost-to-income remain below 27%.
Wayne Percival, UDC’s CEO, said: “We’re playing to our strengths by focusing on our core business of asset finance and growing lending across a diverse portfolio while controlling costs.
“With lending assets of $2.5 billion, we’re supporting New Zealand companies by providing asset financing expertise and helping them succeed in business. Provision expenses remain relatively low by historical standards, highlighting the quality of our lending book.”
UDC continued to grow lending through its diversified portfolio, with motor vehicle lending up 7% and commercial lending up 5% over the half. A wide range of industries contributed, including forestry, transport and construction.
“With the strongest lending growth coming at the end of the half, and margin now stabilising, we’re well placed for further growth in the second half,” Mr Percival said.
“While cost efficiency remains a priority, UDC is still investing in technology, particularly through our online offering with UDC Live.
“Our achievements this half are a credit to the hard work and commitment of our staff. They also highlight our expertise in key sectors and the strong business connections we have built up throughout New Zealand over the years,” Mr Percival said.
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Pete Barnao
Communications Manager, Media
Tel: +64-9-252 6623 or +64-27-277 3139
Email: Pete.Barnao@anz.com
UDC Finance is a wholly owned subsidiary of ANZ Bank New Zealand Limited, and has a Standard & Poor’s* credit rating of AA-, in line with the major banks.
*Credit ratings issued by Standard & Poor’s Ratings Services are solely statements of opinion and not statements of fact or recommendation to purchase, hold or sell any securities or make any other investments decisions. Latest ratings can be found at www.standardandpoors.co.nz