Fee-free Taranaki bank boosts its profit

Friday 31st May 2002

Taranaki-based TSB Bank has reported its 15th successive year of profit growth with an $18.4 million March-year after-tax gain.

The result is up 20% on the previous year in what has been a vintage profit year for all the banks.

TSB will pay a $4.1 million dividend to its owner, the TSB Community Trust.

Funds on deposit at March 31 were $1.48 billion, up 14% on the previous year.

The home loans portfolio grew to $928 million. The bank's capital adequacy ratio stood at 15.03% compared with the minimum 8% recommended by the Reserve Bank.

The country's smallest bank, TSB has differentiated itself from its mostly Australian-owned competitors by charging no fees. This has made it very popular with its customers. This year it won for the third year in a row the "best bank" accolade in University of Auckland's annual research into consumer attitudes to banks.

This year it faces competition from Kiwibank, the "people's bank" set up by Deputy Prime Minister Jim Anderton as a response to the main banks' much complained-about fee structures. Kiwibank, however, charges fees, albeit at a lower level than the main banks.

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