It plans further regional expansion
Judo Bank has reported robust financial and operational results for the fiscal year ending June 30, 2024, with the bank’s loan book expanding by 20% to $10.7 billion.
This growth was driven by the ongoing regional expansion strategy by the bank, which opened four new locations and hired 21 additional relationship bankers over the year. It also plans to establish 10 more locations and recruit 20 additional bankers in FY25 to further accelerate lending.
Judo Bank maintained a balance between margins and risk, with new loan margins averaging mid-4%, aligning with its net interest margin (NIM) of over 3%. The bank recorded its highest lending growth in June 2024, with an average margin of 4.5%. As of June, the pipeline of loans in application, approved, and accepted status reached a record $1.8 billion, also at an average margin of 4.5%.
Impairment expenses totalled $70.1 million, in line with Judo’s guidance. The proportion of customers in 90-day arrears or impaired flattened to 2.31% in June, compared to 2.63% in March.
Judo also successfully refinanced its share of the Term Funding Facility (TFF) through term deposits and wholesale funding. The bank’s term deposit balances grew by $2.2 billion to $8.2 billion, with the number of customers increasing to 46,800. Term deposits accounted for 64% of Judo’s funding as of June, surpassing the bank’s 60% guidance. Judo now targets 75% of its funding to be sourced from term deposits.
During the year, Judo advanced its multi-year technology investment program, upgrading several core platforms to scalable solutions. This included the successful design and migration to a new core lending platform, completed in early FY25.
The bank’s underlying cost-to-income (CTI) ratio also remained stable at 54.6% in FY24, with cost growth slowing due to technology benefits. Judo anticipates significant profit growth in the second half of FY25 and beyond, supported by operating leverage.
Entering FY25, Judo Bank said it is well-positioned to capitalise on growth opportunities, including regional expansion and potential new product segments in SME lending.
“FY24 has been another year of strong financial and operational performance, delivering to our guidance targets, and growing our bank,” said Chris Bayliss (pictured above), chief executive and managing director. “This year, we celebrated several milestones that highlight the incredible progress we have made since our inception in 2016, including marking our five-year anniversary as a fully licenced bank and surpassing $10 billion in lending.
“We have achieved lending growth of 130% per annum since obtaining our banking licence in April 2019. Our above-system growth is supported by our unique customer value proposition, which continues to resonate with SME customers, evidenced by our sector-leading net promoter score.”
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