ASB bank boss Vittoria Shortt says
ASB confirmed that the Sovereign Home Loan book is now part of ASB following the sale of the insurance company to AIA for $1.25 billion.
However, she was less forthcoming around the future for Sovereign Home Loans. SHL is essentially an ASB product with a different brand which is distributed via mortgage advisers and it uses a trail commission model.
Shortt was asked if this would continue. She said all remuneration models across the bank are being reviewed.
The bank's record profit was up 10 per cent on last year and was its eighth record in a row.
Its cash profit, its underlying operating result, was up even more at 12 per cent to $1.14b.
Shortt said New Zealand's strong economic performance over the last year had underpinned its financial result.
Lending by the bank increased 6 per cent to $83b while its deposits were up 7 per cent to $62b.
ASB's cash net interest margin increased by 7 basis points to 2.24 per cent after a period of contraction.
The bank's cost to income ratio also improved increasing 130 basis points to 34.6 per cent and its operating income rose 9 per cent while its expenses grew by 5 per cent driven by investment in technology and regulatory compliance costs.
