Slowdown retards Auswide profit

A special dividend from its captive mortgage insurance arm propped up the profit of Auswide Bank over the year to June 2015, a period in which economic stress in its core markets in North Queensland restrained asset growth.

Bundaberg-based Auswide reported a two per cent decline in net profit to A$12.7 million for the year. This figure includes a dividend of $750,000 from Mortgage Risk Management.

Mortgage Risk Management will be wound up at the end of September, releasing up to $10 million in capital for the core banking group.

Auswide put its underlying cash profit at $13.1 million, a rise of seven per cent. This excludes costs relating to the rebrand (in April) from Wide Bay Australia and the write down on its ATM fleet.

Loan growth for the year was only five per cent, taking the lending book to $2.3 billion. Growth in new business, however, was eight per cent.

The bank highlighted that "in Auswide's traditional markets … general economic conditions continue to be challenging"  - a reference to the subdued outlook for mining and pastoral industries.