Mystate Limited · ASX:MYS
Mystate — Investor Presentation (February 2022)
27 slides from Mystate's investor presentation, Feb 18, 2022
Slide 1: Investor Presentation Half Year 2022
MyStateLimited © Investor Presentation Half Year 2022 human way,
Slide 2: Presenters: Brett Morgan and Gary Dickson
0 1 Brett Morgan 0 ? Gary Dickson Managing Director & CEO Chief Financial Officer Managing Director & CEO
Slide 3: Overview and highlights
Slide 4: Key highlights
MyStateLimited Key highlights Financial performance Strategic initiatives delivered Y Deploying capital raised in June 2021 Y Home loan portfoli h of 11.4% since 30 9 portfolio growth of 11.4% since 30 June (9.6% $6 068m $4 986m growth in Tasmania and 12.5% growth for rest of Australia) ' r Grow Vv
Slide 5: Growth strategy on track
MyStateLimited Growth strategy on track Strong balance sheet growth Investment up as planned * Home loan portfolio growth accelerating; * Operating costs increased 15.6% on pcp 1H22 home loan settlements up 116% on pep driven by increased investment in * Strong growth in customer deposits up 12.4% d
Slide 6: Financial results
Slide 7: Lending growth strong; EPS and ROE dilution as new capital deployed
MyStateLimited Lending growth strong; EPS and ROE dilution as new capital deployed . . . . Total ti ($m) +3.4% A * — Rapidly deploying capital and growing otal operating income ($m loan book Pre-provision operating profit ($m)" 22.1 26.4 -16.3% v * Total operating income up $2.3m (+3.4%) Statutory n
Slide 8: NPAT softer with opex rising to support customer and lending growth
MyStateLimited NPAT softer with opex rising to support customer and lending growth Statutory NPAT decreased 2.4% on 1H21 * Net interest income up 1.1% on pcp benefiting from a higher average balance sheet, partly offset by lower NIM reflecting the competitive market environment for home loans * — Si
Slide 9: Up front investment in growth reflected in operating costs
MyStateLimited Up front investment in growth reflected in operating costs Operating expenditure 60 * Operating costs increased by 15.6% 55 : 4 : ; 50 1.3 1.3 driven by increased investment in 25 13 27 erred oe . 45 — : distribution capability and capacity w 40 and marketing and corresponding S 3 hig
Slide 10: Accelerated home loan book growth
MyStateLimited Accelerated home loan book growth Home loan book — applications and settlements ($b) 1H 2H * Home loan book comprises 98% of lending assets HE) Applications 2.57 | Settlements 2.27 * Home loan settlements of $1.48bn were up 116% 2.05 on pcp ($684m) 1.68 179 . se gt 1.36 * Diversificat
Slide 11: Accelerated home loan book growth
MyStateLimited Accelerated home loan book growth Loan balance & lending flows ($b) * Growth driven by lower risk owner occupied P&I lending with LVR <80% 0.61 0.25 * Fixed rate lending as a proportion of total flow was oan 34% in 1H22 (24% in the pcp) * — Run-off remains a sector wide challenge. MyS
Slide 12: Continued high credit quality
MyStateLimited Continued high credit quality * — Maintaining quality lending growth remains a key focus and underpins balance sheet strength * Focus on low-risk, owner occupied lending with LVR <80% * Loans with a LVR >80% now 22% of the portfolio (Dec 2020: 25%) * Growth in >90% LVR loans reflects
Slide 13: Loan provisioning remains prudent
M StateLimited » Loan provisioning remains prudent Credit provisions ($m) Decrease in Total collective provisions and the General 6.63 Reserve for Credit Losses (GRCL) consistent with lower arrears and the economic recovery as major Australian . + 5.34 cities have exited lockdowns eZ . 4.19 * COVID-
Slide 14: Customer funding driven by online acquisition
MyStateLimited © Customer funding driven by online acquisition Funding mix (%) * Customer deposits grew 12.4% on 30 June 2021 and now represent c.75% of the funding mix * Growth in ‘At call' customer deposits (+16% on 30 ame 5 9.0% 12.1% June 2021) reflects current consumer preferences : * — Signifi
Slide 15: NIM decline expected and a reflection of market dynamics
MyStateLimited NIM decline expected and a reflection of market dynamics NIM waterfall * Net interest margin down 17bps on pcp, driven by margin compression on the home loan book with HE Origination costs growth well above system lM Increase . . . set Decrease * — Lending market remains highly compet
Slide 16: Capitalised for growth
MyStateLimited Capitalised for growth Effective capital strategy underpinning growth and investment in capability Capital raise proceeds of $55.5m being rapidly deployed to execute MyState's growth strategies Capacity for Additional Tier 1 and Tier 2 capital and securitisation to provide further cap
Slide 17: • 2.61 • 2.29 2.50 2.09 1.97 • 5.60 5.10 4.86 4.69 4.84 •
• 2.61 • 2.29 2.50 2.09 1.97 • 5.60 5.10 4.86 4.69 4.84 • •
Slide 18: Strategy and outlook
Slide 19: Operating environment creating opportunities
MyStateLimited Operating environment creating opportunities Economic and industry dynamics MyState’s response * Continue to grow market share in our heartland ree . aQol] Economic growth and low unemployment * Accelerate growth in eastern seaboard markets ulvilih Low credit growth combined with low
Slide 20: 2025 growth strategy being executed
MyStateLimited 2025 growth strategy being executed Our ambition is to grow our share in deposits, lending and FUM. Our growth strategy is focused and bold. It builds on our strong financial position and high customer NPS to access specific growth opportunities in eastern seaboard markets, via a stro
Slide 21: Key strategic objectives unchanged
MyStateLimited Key strategic objectives unchanged HH: Closing remarks * Rapidly accelerate balance sheet growth over the ; * Demonstrated capability on strategic execution medium term, while maintaining asset quality H * Trusted and respected challenger brand with leading * Improved operating levera
Slide 22: Appendix
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Slide 23: MyState positioned for accelerated growth
MyStateLimited © * Diverse financial services business across banking and wealth management * Geographical spread with greater than 60% of the home loan book in mainland Australia * Consistent above system growth in loan and deposit books * Experienced management team with a track record of deliveri
Slide 24: Migration to digital continues
MyStateLimited Migration to digital continues * Customer uptake of internet and mobile banking increasing. * Digitisation of back office processes increasing scalability and speed. * Al insights in MyState Bank app generating over 1.5m insights per month. * 95% of transactions completed digitally. *
Slide 25: Total loans with assistance
MyStateLimited Total loans with assistance (facilities, no.) 1,739 p09 $574m Total loans with assistance (balances, $m) 1,530 301 77 $11m $5m 3 Jun 21 Jun 20 Dec 20 Jun 21 Dec 21 Jun 20 Dec 20 Dec 21 m Reduce Repayments/ Change to Interest Only = Defer Repayments ™ Reduce Repayments/ Change to Inter
Slide 26: Glossary of abbreviations
1H: First half of financial year 2H: Second half of financial year ADI: Authorised deposit-taking institution APRA: Australian Prudential Regulation Authority Avg: Average ASX: Australian Securities Exchange BBSW: Bank Bill Swap Rate BDD: Bad & Doubtful Debt Expense bps: basis points CAGR: Compounde
Slide 27: Summary Information
Summary Information This Presentation contains summary information about MyState Limited (ABN 26 133 623 962) and its activities current as at the date of this Presentation. The information is subject to change without notice and does not purport to be complete or comprehensive. It does not purport