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Suncorp tracking well, sees earnings increase

Suncorp tracking well, sees earnings increase

(25 February 2005 – Australia) Suncorp has posted a first half net profit of A$413 million, a 47 percent increase on the corresponding period a year earlier. The bank said all business lines were tracking well and it expected to see a significant increase in underlying earnings in FY 2005.

Suncorp’s banking profit grew by 24 percent to A$220 million on the back of lending and deposits growth, increased margins and tight cost control.

The bank said business banking delivered growth of 19.7 percent in assets and that commercial lending had jumped 23 percent on the back of a better broker distribution model and market specialisation.

Suncorp chief executive John Mulcahy said he expected credit growth to slow in the property development and investment segments.

He also echoed other bank chief executives, saying the increasingly competitive environment would put pressure on margins.

But he said the bank was confident it would outperform the market in the current period.

"For the full year, we would expect profit before tax to increase by a percentage in the high teens, up from our previous expectations of an increase greater than single digits," Mulcahy said.

The insurance business grew by 47 percent to A$213 million, while funds under management increased by 17.5 percent to hit A$12 billion.
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