Heartland stays on track for FY26 profit targets as niche lending grows

Heartland Group Holdings Ltd. ( (DE:73X) ) has shared an announcement.

Heartland Group Holdings says it remains on track to deliver at least a 7% underlying return on equity and underlying net profit after tax of no less than $85 million for the year to 30 June 2026, as net interest margins expanded and the group’s cost-to-income ratio improved. Asset quality strengthened with lower non-performing loans at Heartland Bank, while non-strategic assets were further reduced and capital freed up, although the lender is maintaining a cautious stance amid geopolitical uncertainty in the Gulf and potential flow-on effects for New Zealand and Australian customers.

In New Zealand, Heartland Bank reported improving arrears in its motor finance book, ongoing clearance of non-performing loans, and strong growth in reverse mortgages, rural lending and a return to growth in motor and asset finance, even as subdued portfolio expansion and NSA run-off weighed on its cost-to-income ratio. In Australia, Heartland Bank Australia enjoyed wider net interest margins and a sharply lower cost-to-income ratio following the early repayment of a medium-term note, with strong reverse mortgage growth offsetting a contraction in livestock finance due to extreme weather and a major customer’s funding shift, leading the bank to cut its livestock growth ambitions to flat for FY2026.

More about Heartland Group Holdings Ltd.

Heartland Group Holdings Limited is a trans-Tasman financial services group listed on the NZX and ASX, operating primarily through Heartland Bank in New Zealand and Heartland Bank Australia. The group focuses on niche banking segments including reverse mortgages, motor and asset finance, rural and livestock lending, and business finance for customers in New Zealand and Australia.

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