NGM well positioned for growth

John Kavanagh

NGM Group CEO Bernadette Inglis

Newcastle Greater Mutual Group finished the 2022/23 financial year with A$20.1 billion of assets, making it one of the country’s biggest mutual banks and a “significant financial institution” for regulatory purposes.
 
NGM Group is the product of the merger of Newcastle Permanent Building Society and Greater Bank, which was completed on March 1. Centred in the Hunter region of New South Wales, it has just over 600,000 customers, more than 1600 staff and 100 branches.
 
NGM Group chief executive Bernadette Inglis said she did not expect the bank’s elevation to SFI status to result in a significantly higher regulatory burden or compliance cost on the organisation.
 
“We have always taken a very prudent approach and had a very positive relationship with the regulator,” Inglis said.
 
NGM Group released its 2023 annual report yesterday, highlighting a profit of $72.9 million, a net interest margin of 2.35 per cent, a 15 per cent increase in new customer numbers and a strong capital position, with a capital ratio of 21.9 per cent. 
 
The financial report does not include a pro forma statement allowing for comparison on a like-for-like basis with the previous year.
 
The bank has a $15.3 billion home loan portfolio and a $16.5 billion deposit book.
 
Inglis said the bank has retained 80 to 90 per cent of customers rolling off fixed rate mortgages. The mortgage arrears rate is low, at 9 basis points.
 
Part of the rationale for the merger was to give the group the resources to invest in systems and product. Inglis said NGM is undertaking a $3.5 million refurbishment of the branch network and has made a commitment to keep all branches open for two years.
 
It has launched a digital home loan, initially for refinance but recently made available to home buyers. 
 
Inglis said digital lending now accounts for about 5 per cent of mortgage sales and that share is likely to grow.
 
“This is a huge benefit for customers who are time poor and want control over their banking processes,” she said.
 
NGM has worked with a range of service providers to put the technology and data services in place, including OCR Labs, DocuSign, illion, CoreLogic, LendFast and Loanworks.
 
“We are looking at partnerships to extend our capabilities. Our new method of digitally identifying customers could be used across more products and services, streamlining services across NGM Group,” Inglis said.