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PSIS reports a good end-of-year financial result

Media Release

PSIS reports a good end-of-year financial result

22 June 2011

Despite the local impacts of the international economic turmoil, PSIS chair Sir David Gascoigne announced today that PSIS has delivered a good performance in line with the forecast.

“We can report a $9.3 million profit before tax for the year ended 31 March 2011.”

“While hopefully the worst of the global financial crisis (GFC) is behind us, times remain uncertain and the New Zealand economic environment continues to be challenging.”

Sir David said that against this backdrop PSIS has achieved greater liquidity and stronger capital ratios.

“We’ve strengthened our balance sheet. Our retail deposit volumes were up by 4%, and our loans grew by 4%. Our reserves have grown to $123.9 million, and our capital adequacy ratio continues to exceed considerably what’s required of the trading banks.”

“As a co-operative we’re owned by our customers, this means that at all times we work for the betterment of our members, and we take an unashamedly conservative approach to financial management. Profit isn’t an end in itself, rather we operate profitably so we can continue to invest in order to deliver excellent systems, products and services. These are major reasons why PSIS, and so many other co-operatives internationally, have successfully weathered the GFC,” Sir David said.

PSIS chief executive Girol Karacaoglu said: “Our conservative lending policies and risk management framework have meant that during this past financial year our loan impairments and losses were held at targeted levels, and would’ve been down 20% on the previous period had it not been for the Christchurch earthquakes. While it’s difficult to assess the final impact of these tragic events, we’ve made provisions for increased loan losses.”

“In the current climate PSIS has chosen to maintain high levels of liquidity, and this was assisted by completing a $100m Medium Term Note issue to raise money on the wholesale market. Overall, this additional liquidity means that, when the economic recovery starts in earnest, we’ll be better positioned to help our members.”

“In the short-term we remain focused on giving greater effect to our members’ ownership. This year we’ll continue to research how best we can do this, in practice.”

“In short, PSIS is in excellent shape. We’re going forward with a strong balance sheet and strong sense of purpose,” Dr Karacaoglu said.”

ENDS:

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