St.George Bank delivers sound full-year result

Wednesday, 3 November 2010

Continues investment in front-line services for customers Increases lead in customer advocacy, driving customer growth and improved share-of-wallet.

St.George Bank completed the 2010 financial year in a good position, with an increased lead over the major banks in customer advocacy and continued targeted investment in its front-line business.

St.George Bank reported a sound full-year financial result, with cash earnings of $1,041m, stable on the full-year 2009, following growth in home lending, personal lending and deposits. Second-half cash earnings of $569m were up 21 per cent on first-half 2010, driven by lower impairment charges.

Commenting on the result, St.George Bank Chief Executive, Greg Bartlett, said:

“St.George has continued to grow its lead over the major banks in customer advocacy, which has driven our excellent customer retention rates and continued growth in customer numbers, particularly through our proprietary channels,” Mr Bartlett said.

“Our customers are also doing more of their banking with us, with our average products per customer increasing this year on the back of our expanded product offering, particularly in credit cards, wealth management and SME banking products.”

Mr Bartlett said St.George had continued to make disciplined investments in its business this year, which has strengthened the St.George brand and customer experience.

“This includes the opening of nine new branches in key growth locations, more than 290 additional customer-serving employees, investment in our ‘Big Enough, Small Enough’ brand proposition and the roll-out of a range of new products and e-solutions for our customers.”

“Pleasingly, our customers continue to respond to our ‘Big Enough, Small Enough’ market positioning, which captures the essence of St.George’s personal, local service - backed by the strength and full range of services of a large banking group.”

Results Commentary (Full Year 2010 on Full Year 2009)

• Consumer and business customer advocacy increased and maintained lead over the major banks.
• Customer numbers increased by more than 30,000.
• Customers with four or more products increased to 24 per cent from 22 per cent.
• Mortgage lending increased 8 per cent to $89.5bn.
• Deposits grew 7 per cent to $65.6bn.
• Personal lending, including cards, grew 10 per cent, assisted by the launch of a new St.George rewards credit card, called ‘Amplify’.
• Business lending was down 5 per cent as businesses continued to reduce gearing, particularly in commercial property.
• Impairment charges decreased 14 per cent, or $83m, as property markets stabilised.

Full-Year 2010 Financial Highlights

St.George Bank will continue to focus on sustainable growth in 2011, with an additional 10 new branches planned to open in key growth areas, supported by the Bank’s highly targeted, segment driven strategy and local market model.

Incoming St.George Bank Chief Executive, Rob Chapman, who will commence in his new role on 1 December 2010, said:

“St.George is in great shape. Greg Bartlett and St.George’s executive team have done a fantastic job retaining St.George’s customer-focused culture, growing our lead over the major banks in customer advocacy and building on our strong brand.

 “As CEO, I look forward to continuing St.George’s customer-led focus and sustainable growth strategy, and building on our strong position in the market as a unique alternative to the major banks.”

St.George Bank employs 5,900 staff and operates 405 branches throughout Australia.

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