Heartland eyes vehicle finance growth
Heartland Group Holdings has reaffirmed plans to increase its emphasis on digital transactions and is keen for continued growth in vehicle finance.
The company says much of its new lending for motors in the second half of the 2020 financial year came about because of Heartland Bank’s innovative digital platforms, which allowed dealers to provide finance to customers despite Covid-19 restrictions.
Its annual report, which was released on October 30, shows motor finance enjoyed a strong result in the first half of the 2020 financial year. However, the second half “was characterised by higher repayment levels”.
“While new lending held up strongly in the period March 1 to June 30, 2020 ($164.8m) repayments were $164.2m … As a result, motor posted a largely flat volume growth in 2H2020,” it notes.
Heartland’s motor finance section saw its annual net operating income hit $60.6 million at the end of June 2020, an increase of $3.5 million, or 6.2 per cent, when compared with the 2019 financial year.
Motor receivables climbed $37m, or 3.4 per cent, to $1.13 billion over the same period, mainly due to an increase in the motor dealer book.
The group’s overall receivables were up $215m, or 4.9 percent, to $4.6b. Meanwhile, net profit after tax fell $1.6m, or 2.2 per cent, to $72m.
Jeff Greenslade, chief executive officer, says Heartland is committed to expanding its digital and online offerings after seeing the value of those innovations during the Covid-19 pandemic.
“Heartland’s digital platforms enabled customers to access products and services despite alert level restrictions on in-person transactions,” he explains.
“Heartland’s intermediary motor vehicle dealers were able to progress vehicle loan applications by sending biometrics facial recognition links to customers.
“Increased investment will be undertaken in technology to expand digital capability to meet Heartland’s growth aspirations and the needs of customers – particularly in a post-Covid-19 world where the ability to interact online is of even greater importance.”
Looking to the year ahead, Greenslade says Heartland expects continued growth in New Zealand across its motor, business and reverse mortgage products.
