VicTeachers scores Moody's ratings tick

Another large, vocationally-based credit union has secured a lift in its long term credit rating. Moody's Investors Service yesterday said it upgraded the long-term issuer and senior unsecured ratings of Victoria Teachers Mutual Bank to A3 from Baa1.

Earlier this month Teachers Mutual Bank received a long-term rating of A3 from Moody's.

Moody's said that "historically, VTMB's rating has been constrained by concerns regarding potential challenges to asset quality and capital, stemming from the bank's very strong loan growth during 2008 to 2011."

Over that period gross loans grew at 18 per cent per year on average, more than double overall banking system growth of eight per cent per year.

William Wolke, VTMB's chief executive said growth was now "ameliorating, we expect growth at eight to nine per cent levels.

"We are very proud of the quality of the book. It's good to get these outcomes for the right reasons," he said.

"Our customer satisfaction, on Roy Morgan data, was 99 per cent. Our net promoter score is so high - it's almost like an internet company with a banking licence. That's how we like to think of ourselves."

Pre-tax profit for VTMB jumped to A$18.9 million from $10.3 million in the year to June 2014.

Deposit growth of 7.9 per cent to $1.75 billion supported loan growth of five per cent to $1.49 billion. Total assets increased by eight per cent to $1.92 billion.