Heartland New Zealand, the country's newest bank, reported a 71 per cent slide in annual profit after booking charges to take control of distressed assets previously managed by Pyne Gould Corp.
Net profit fell to $6.9 million, or 2 cents per share, in the 12 months ended June 30, from $23.6 million, or 6 cents, a year earlier, the Christchurch-based lender said in a statement. That was in line with June guidance when Heartland said it was going to take an $18 million charge on writing down the value of loans and investments and to cover the risk of holding some of those assets over a longer time frame.
Stripping out the one-off impairment, adjusted profit rose to $24.4 million and revenue gained 13 per cent to 107.4 million. The bank affirmed its 2014 forecast for net profit of between $34 million and $37 million.
"The NPAT expectation for the next financial year reflects ongoing reductions in cost of funds, lower impairments, continued focus on cost reductions and asset growth in core assets in line with credit growth expectations," the company said.
The board declared a final dividend of 2.5 cents per share, with a September 20 record date, payable on October 4. That takes the total payout to 6 cents per share.
