Mystate Limited · ASX:MYS

Mystate — H1 2015 Earnings Presentation

25 slides from Mystate's earnings presentation, Feb 20, 2015

  1. Slide 1: For personal use only

    For personal use only

  2. Slide 2: Important notice and disclaimer

    Important no*ce This presenta,on contains certain forward-­‐looking statements with respect to the financial condi,on, results of and disclaimer For personal use only opera,ons, business plans and objec,ves of management. All such forward-­‐looking statements involve known and unknown risks, significa

  3. Slide 3: For personal use only

    For personal use only MyState Limited Investor Presenta,on 3

  4. Slide 4: Significant improvements in lending

    Significant 1. NPAT increases to $14.9m. improvements in For personal use only 2. Loan book growth at 1.6 ,mes system*. lending. 3. Sound risk management – high credit quality. 4. Cost-­‐to-­‐income ra,o down 60bps to 64.5%. 5. Capital ra,o remains strong at 13.3%. Despite fierce *6 months to December

  5. Slide 5: Momentum delivering green shoots of revenue and NPAT growth

    Balance sheet H1 2014 H2 2014 H1 2015 Change Change H1 2015 v H1 2015 v momentum For personal use only H1 2014 H2 2014 delivering green Revenue ($m) 60.6 58.7 60.4 q -­‐0.3% p 2.9% shoots of revenue Net profit acer tax 14.8 14.8 14.9 p 0.7% p 0.7% and NPAT growth. ($m) Net Interest Margin 2.45 2.

  6. Slide 6: Strong operational improvements in our banking business

    Strong opera*onal • SeJlements going from strength to strength. improvements in our For personal use only banking business. • Broker channel driving loan book momentum. • Arrears trending well below peers. Enhanced financial • Ongoing simplifica,on of processes and systems posi,ons the performance bus

  7. Slide 7: Solid interim results driven by significant upward momentum in settlements

    Solid interim results SeLlements con*nue to build following a strong 2H 2014 Monthly Loan SeLlements $M driven by significant For personal use only 120 $404.2m upward momentum 65% increase over pcp in seLlements… 100 SeLlements ($M) …2015 con*nues 80 $245.6m strong first half 60 growth. 40 December qu

  8. Slide 8: MyState Foundation grant recipient

    For personal use only Nate Austen from the Westbury Community Health Centre – a MyState Founda,on grant recipient MyState Limited Investor Presenta,on 8

  9. Slide 9: Continuing modest recovery in economic environment

    Con*nuing modest The Tasmanian economy is in recovery: recovery in economic • Jobs added for the 14th consecu,ve month in December. For personal use only environment. • Dwelling approvals con,nued to improve over the half year. • Employment in the Tasmanian economy is at its highest level since late

  10. Slide 10: NPAT Movement: 1H 2014 v 1H 2015

    NPAT Movement: 1H 2014 v 1H 2015 Margin pressures $15.50 hinder NPAT For personal use only 0.76 0.29 14.8 0.84 0.02 14.9 $15.00 0.51 growth. 0.48 0.16 NPAT $Millions $14.50 0.25 0.05 0.02 0.04 $14.00 $13.50 $13.00 • Net interest income (NII) down on pcp. Compe,,ve loan pricing to acquire and retain

  11. Slide 11: NPAT Movement: 2H 2014 v 1H 2015

    Revenue growth $16.50 NPAT Movement: 2H 2014 v 1H 2015 is building following For personal use only $16.00 $0.53 strong loan book $15.50 $0.52 momentum in $14.8 $0.48 $0.88 $0.02 $14.9 NPAT $Millions $15.00 second half of 2014. $14.50 $0.24 $0.09 $0.06 $2.03 $0.21 $14.00 $0.15 $13.50 $13.00 • First h

  12. Slide 12: Product and pricing strategy attracting lower LVR business

    Product and pricing Nearly 60% of home loans funded were under 80% LVR strategy successful in For personal use only Percentage of home loans funded by LVR band 70% aLrac*ng lower LVR business. 60% % of SeLlements 50% 40% 30% 18% 20% 10% 0% <80% 80 -­‐ 90% 90 -­‐ 95% 95+% LVR Band MyState Limited Inv

  13. Slide 13: Significant turnaround in total loan book momentum

    Total Loan Book Growth 5.1% (10.1% p.a.) for 1H 2015 Significant and 3.25 Loan Porbolio ($Billions) ↑ 155.0m pleasing turnaround in For personal use only 3.20 5.1% total loan book 3.15 ↑ momentum… 3.10 ↓ 37.7m 53.2m 3.05 1.8% 3.00 1.3% 2.95 2.90 2.85 Jun'13 Dec'13 Jun'14 Dec'14 Residen*al Mortgage Bo

  14. Slide 14: Home loan momentum driven by revitalised strategies

    Home loan Revitalised strategies deliver 8.9% home loan growth momentum driven For personal use only over the calendar year 8.9% by revitalised (Home Loan Book by channel – $bn) product and sales 3.20 Home Loan Porbolio ($Billions) 2.90 and distribu*on 2.60 2.30 strategies. 2.00 1.70 1.40 1.10 0.80

  15. Slide 15: Investor loans growing at a sustainable rate

    Investor loans Investor lending contributed a quarter of growing at a For personal use only first half home loan growth... sustainable rate. 25% Investment Owner occupied 75% But remains a small por*on of the book. 11% 89% MyState Limited Investor Presenta,on 15

  16. Slide 16: Group NIM declines in 1H 2015

    Group NIM declines in 1H 2015 Margin declines For personal use only 2.50% due to: 2.45% 2.45% • Fierce compe,,on for 2.42% home loans impac,ng 2.40% 2.41% front book and back book 2.39% 2.36% • Changing por]olio mix 2.35% (high yielding por]olios declining) and 2.30% capitalisa,on of broker commissi

  17. Slide 17: Funding diversification supports loan growth

    Funding • Diversifica,on within the deposit book maintained. diversifica*on For personal use only • Steady funding from cheaper at call deposits. supports loan growth. • Wholesale TDs u,lised to support asset growth. • Successful ConQuest 2014-­‐2 RMBS transac,on in December provides further support f

  18. Slide 18: Geographic diversification improving

    Geographic diversifica*on December 2014 For personal use only improving with 0.1% $2.5M sound growth in 16.2% $485.0M 2.5% $75.0M NSW and VIC. 0.7% $19.9M 8.4% $251.9M 7.5% $223.8M June 2014 64.7% $1,942.9M 0.1% $2.3M 16.2% $468.6M 2.2% $61.9M 0.7% $19.2M 8.3% $234.1M Home loan porFolio distribu6on 5

  19. Slide 19: Arrears holding steady through the first half of 2015

    30+ Days S & P Arrears Data Arrears holding For personal use only 3.0% steady through 2.5% the first half of 2.0% 2015… 1.5% 30+ day arrears 1.0% reflect the sound credit quality 0.5% within the loan 0.0% Feb-­‐13 May-­‐13 Aug-­‐13 Nov-­‐13 Feb-­‐14 May-­‐14 Aug-­‐14 Nov-­‐14 book. S & P Regional Bank

  20. Slide 20: Wealth management performance solid and steady

    Wealth management • Modest 1% growth in Funds Under Management to $1.017b. performance solid For personal use only • Revenues liced by 5.2% on 2H 2014. and steady. • First half NPAT of $2.1M in line with pcp. Wealth Management FUM ($m) Revenues ($m) NPAT ($m) 1,030 $10.0 3.0 Millions 1,020 $9.0 1.80

  21. Slide 21: Firm cost management helps half year result

    Firm cost $m Personnel Costs $m Technology Costs 21 5.0 management helps For personal use only 20 4.0 half year result. 19 18 3.0 2.0 17 16 1.0 15 0.0 2013 2013 2014 2014 2015 2013 2013 2014 2014 2015 H1 H2 H1 H2 H1 H1 H2 H1 H2 H1 • Addi,onal sales capability built to • Investment in data centre cap

  22. Slide 22: First half cost-to-income ratio improves to 64.5%

    First half Cost-­‐to-­‐income ra*o improves 60bps to 64.5% on pcp cost-­‐to-­‐income ra*o For personal use only 90.0 80.0% 78.0% improves to 64.5% 80.0 76.0% 74.0% (1H 2014: 65.1%). 70.0 72.0% Millions 60.0 70.0% 68.0% 50.0 66.0% 40.0 64.0% 62.0% 30.0 60.0% 2H 2012 1H 2013 2H 2013 1H 2014 2H 2014 1H

  23. Slide 23: For personal use only

    For personal use only MyState Limited Investor Presenta,on 23

  24. Slide 24: Summary and outlook

    Summary and • Sound NPAT with core business gaining momentum. • Strong loan book growth driving uplic in revenue. For personal use only outlook… • M&A opportuni,es to be explored. Well posi*oned • Enhanced systems will further improve service and turnaround ,mes. and on the move. • Simplified process

  25. Slide 25: About MyState Limited

    For personal use only About MyState Limited MyState Limited is an ASX-­‐listed diversified financial services group consis,ng of MyState Bank (MyState); Tasmanian Perpetual Trustees (TPT), a trustee and wealth management company; and The Rock Building Society (The Rock). MyState Limited, MyState and T

MyState — H1 2015 Earnings Presentation on 6ix