Heartland Bank retains interest in ANZ's UDC division

Tuesday 22nd November 2016

Heartland Bank has told investors that it remains interested in buying asset finance company UDC from ANZ Bank, describing it as an "ideal fit."

In his speech at the company's annual general meeting in Christchurch, chief executive Jeff Greenslade said he believed the acquisition would "complement our strategy and would provide a number of synergies."

UDC is one of NZ's largest and oldest finance companies, with widespread reports in April that ANZ was considering a sale. Greenslade said market sentiment suggested a decision on UDC's future is "imminent."

Net profit after tax for the three months to the end of September was $14.3 million, up 21 percent on the same period a year earlier. Management remain confident of achieving the net profit after tax target of $57 to $60 million for full-year 2017.

Investors were also told that a more competitive funding market was emerging, with increased competition for deposits due to demand for credit outstripping available savings. Greenslade also noted that the banking industry was moving off historically low-levels of impairments, and "it is still necessary to be cautious and watchful in terms of exposure to global markets."

Over the next three months, Heartland intends to offer residential mortgages, deposits and lending on livestock online.

It increasingly intends to use its website to target 'millenials', people in their late-teens to early thirties as well as people over the age of 55, who Heartland say are the fastest growing demographic in social media use.

Shares in Heartland Bank fell 0.65 percent or 1 cent to $1.52. They've risen 15.9 percent since the start of the year.

BusinessDesk.co.nz

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