Slide 1: FY20 Results Presentation
For personal use only Resimac Group Ltd FY20 RESULTS PRESENTATION August 2020
Slide 2: Performance Highlights
For personal use only PERFORMANCE HIGHLIGHTS Scott McWilliam, CEO Jason Azzopardi, CFO
Slide 3: FY20 Performance Highlights (v FY19)
FY20 PERFORMANCE HIGHLIGHTS (v FY19) For personal use only $56.0m $55.7m $188.6m 37.9% STATUTORY1 NORMALISED2 NET INTEREST COST TO INCOME NPAT NPAT INCOME RATIO (NORMALISED) 19% 79% 60% 1,870bps $4.7b $12.4b $14.9b 1.8c HOME LOAN HOME LOAN ASSETS TOTAL ASSETS UNDER FINAL DIVIDEND SETTLEMENTS UNDER M
Slide 4: Financial Results Summary
PERFORMANCE HIGHLIGHTS FINANCIAL RESULTS SUMMARY For personal use only Significant NPAT increase driven by record settlements, AUM growth and higher margins. 1,870bps reduction in Cost to Income Ratio driven by revenue growth and strong cost discipline. Return on equity increased 820bps to 25.
Slide 5: Earnings Growth
PERFORMANCE HIGHLIGHTS EARNINGS GROWTH For personal use only Normalised NPAT increased 79% driven by higher Net Interest Income (+60%) from AUM growth and lower BBSW, partly offset by lower customer rates. Excluding Paywise^, FY20 net fee & commission expense increased $8.7m driven by lower deri
Slide 6: Key Metrics
PERFORMANCE HIGHLIGHTS KEY METRICS For personal use only REVENUE & EARNINGS COST TO INCOME RATIO 35 120 70.0% 68.2% 104.3 30 84.3 100 65.0% 61.7% 25 60.0% 56.6% 62.8 80 20 55.1 55.0% 51.6 $m $m 60 15 28.8 50.0% 26.9 40 45.0% 42.1% 10 14.5 16.6 37.9% 13.3 20 40.0% 5 34.6% 0 0 35.0% 2H18 1H19 2H19 1H2
Slide 7: Group Margin
PERFORMANCE HIGHLIGHTS GROUP MARGIN For personal use only GROUP NET INTEREST MARGIN (BPS) BBSW (SPREAD OVER CASH) 35 33 RBA CASH RATE 30 Jun 19: 1.25% (-0.25%) July 19: 1.00% (-0.25%) 25 Oct 19: 0.75% (-0.25%) 21 Mar 20: 0.50% (-0.25%) 20 Mar 20: 0.25% (-0.25%) 15 9 10 5 3 - -5 -2 FY18 FY19 1H20 2H2
Slide 8: Funding Program
PERFORMANCE HIGHLIGHTS FUNDING PROGRAM For personal use only Despite COVID-related challenges in wholesale banking and credit markets, the Group extended and increased >$2bn of Prime and Non-conforming warehouse facilities in 2H20. In addition to $2bn of RMBS issuance in 1H20, the Group settled
Slide 9: Home Loan Portfolio Performance
PERFORMANCE HIGHLIGHTS HOME LOAN PORTFOLIO PERFORMANCE For personal use only ARREARS (%) SPECIFIC LOAN PROVISIONS 2.00% 2.01% 1.85% $m June 2019 Dec 2019 June 2020 1.70% Prime 0.35 0.43 0.61 1.40% 0.87% 0.80% Specialist / Near Prime 3.26 3.40 3.37 0.79% 0.83% 0.65% 0.60% RHG 1.50 1.98 1.93 0.23% 0.2
Slide 10: Home Loan Portfolio Composition
PERFORMANCE HIGHLIGHTS HOME LOAN PORTFOLIO COMPOSITION For personal use only Weighted average portfolio LVR – Prime 66.3%; Specialist 68.8% Weighted average portfolio dynamic LVR – Prime 65.7%; Specialist 70.2% GEOGRAPHIC LOCATION 5% 5% NSW LOAN PURPOSE 7% 37% VIC 42% Owner Occupied QLD 17% WA 58% I
Slide 11: COVID-19 Impact
For personal use only COVID-19 IMPACT Scott McWilliam, CEO Jason Azzopardi, CFO
Slide 12: COVID-19 Hardship Analysis Summary
COVID-19 HARDSHIP ANALYSIS SUMMARY For personal use only Resimac is well placed to navigate the COVID-19 pandemic with strong historical portfolio performance and industry low arrears. Portfolio diversified both geographically and by borrower industry and employment sectors. 10% of customers a
Slide 13: COVID-19 Hardship Analysis Summary: Payment Deferrals
COVID-19 HARDSHIP ANALYSIS SUMMARY For personal use only PAYMENT DEFERRALS AT 30 JUNE 20201 ACTIVE PAYMENT DEFERRALS AT 31 JULY 20201 22% 33,200 33,200 35,000 25% 35,000 25% 19% 30,000 30,000 20% 20% 25,000 21,317 25,000 21,317 20,000 15% 20,000 15% 9% 10% 15,000 10% 15,000 7% 10% 6% 5% 5% 10,000 6,
Slide 14: Prime Payment Deferrals
COVID-19 HARDSHIP ANALYSIS PRIME PAYMENT DEFERRALS For personal use only GEOGRAPHIC LOCATION 4% 2% 7% LOAN PURPOSE NSW 42% 39% VIC Owner Occupied 19% QLD Investment WA 58% SA Other 29% 18% 21% DYNAMIC LVR 34% LOAN TYPE 0% - 60% Principal & Interest 61% - 80% 18% 81% - 90% Interest Only 66% >90% 43%
Slide 15: Specialist Payment Deferrals
COVID-19 HARDSHIP ANALYSIS SPECIALIST PAYMENT DEFERRALS For personal use only GEOGRAPHIC LOCATION 6% 1% 6% LOAN PURPOSE 30% NSW 37% VIC Owner Occupied 15% QLD Investment WA SA 70% Other 35% 13% 26% 20% DYNAMIC LVR 0% - 60% LOAN TYPE Principal & Interest 61% - 80% 20% Interest Only 81% - 90% >90% 74%
Slide 16: Borrower by Industry Type
COVID-19 HARDSHIP ANALYSIS BORROWER BY INDUSTRY TYPE For personal use only PRIME PORTFOLIO OCCUPATION SPECIALIST PORTFOLIO OCCUPATION Agriculture, Mining & Manufacturing 2.78 1.53 2.63 Agriculture, Mining & Manufacturing 2.34 Air 1.09 0.56 0.83 Air 0.23 Building & Construction 8.93 18.99 8.00 Buildi
Slide 17: Strategic Priorities & Outlook
For personal use only STRATEGIC PRIORITIES & OUTLOOK Scott McWilliam, CEO
Slide 18: Building a Digital Non-Bank
BUILDING A DIGITAL NON-BANK For personal use only Collaboration 01 Partnering with industry leading technology and data providers to deliver digital solutions for our customers Automation 02 Utilise modern technologies and platforms to automate and build scale, drive organic efficiency and improve c
Slide 19: Resimac Digital Roadmap
RESIMAC DIGITAL ROADMAP For personal use only 1H FY20 2H FY20 1H FY21 2H FY21 1H FY22 New online Digital telephony and Latest CMS technology New origination Origination platform application integrated customer platform pilot replacement New direct channel contact system Electronic brand launch
Slide 20: Launch of homeloans.com.au
LAUNCH OF For personal use only Launch of homeloans.com.au, our new ‘direct to consumer’ online brand. Customers are transacting more online today than ever before, further accelerated by the COVID lockdowns. Market leading online application Instant conditional approval End-to-end digital hom
Slide 21: Resimac Asset Finance (IA Group)
RESIMAC ASSET FINANCE IA GROUP For personal use only AUM NPAT COVID ARREARS PAYMENT $59m $0.7m DEFERRALS 0.6% <4% Resimac acquired 60% of IA Group in January Digitalisation (workflow complete, establishing a 2020 including an option to purchase the broker portal). remaining 40% by December 2021. Fun
Slide 22: Financial Results
For personal use only FINANCIAL RESULTS Jason Azzopardi, CFO
Slide 23: Consolidated Statement of Profit or Loss
CONSOLIDATED STATEMENT OF PROFIT OR LOSS FOR THE YEAR ENDED 30 JUNE 2020 For personal use only FY20 $m FY19 $m Interest income 459.3 445.3 Interest expense (270.7) (327.4) Net interest income 188.6 117.9 Fee and commission income 11.3 19.0 Fee and commission expense (36.1) (31.5) De-recognition of i
Slide 24: Consolidated Statement of Financial Position
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2020 For personal use only $m 30 JUN 20 30 JUN 19 $m 30 JUN 20 30 JUN 19 Assets Cash reconciliation Cash and bank balances 366.0 224.8 Cash at bank and on hand 27.8 10.6 Trade and other receivables 6.0 10.7 Cash collections account 336.7 212
Slide 25: Consolidated Statement of Cash Flows
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2020 For personal use only $m FY20 $m FY19 $m Cash flows from operating activities Interest received 471.0 452.3 Interest paid (264.0) (318.6) Receipts from loan fees and other income 46.7 51.7 Payments to suppliers and employees (155.0
Slide 26: Scott McWilliam and Jason Azzopardi
For personal use only Scott McWilliam Jason Azzopardi Chief Executive Officer Chief Financial Officer Scott is responsible for managing the overall operations of the Jason joined the Resimac Group in July 2018 as Chief Financial Officer. organisation, its people and resources and ensures the Jason i
Slide 27: Important Notice & Disclaimer
IMPORTANT NOTICE & DISCLAIMER The information in this presentation provides an overview of the results for the year ended 30 June 2020. It is general background For personal use only information about the activities of Resimac Group Ltd and is current as at the date of the presentation, 26 August 20
Slide 28: For personal use only
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