MeDirect Bank has reported a pre-tax profit of €2.7 million for the first six months of the year, compared to €3.2 million for the same period last year.
It said on Tuesday that operating income grew by 7% whilst improved market conditions led to a €3.5 million net release of loan impairment charges. Net interest income increased by 11% compared to the same period last year, from €25.8 million in 2021 to €28.7 million, while net fee and commission income increased by 8% from €2.8 million in 2021 to €3.1 million.
The group’s non-performing loan ratio was reduced to 4.6% as at 30 June 2022, from 6.7% in 31 December 2021.
The bank said that over the six months it had continued its transformation towards becoming a pan-European WealthTech leader and a specialised mortgage lender. Its said its strategy is based on building a world-class WealthTech platform, growing its retail franchise focused on affluent customers, de-risking and diversifying its balance sheet with a focus on mortgages, and improving the efficiency of its operating model.
“In the coming months, MeDirect will continue to strengthen its platform with the launch of online advisory and discretionary portfolio management services, as well as, virtual and physical cards to enhance its everyday banking offering. This unique combination of daily banking and wealth services available via both the mobile app and online banking platform is expected to be highly differentiating in the market,” said Arnaud Denis, Chief Executive Officer of MeDirect Group.
The bank said key developments in the first half of the year included the building of a scalable specialised mortgage lending platform in Malta, Belgium and the Netherlands. In Malta, it introduced three new products – green home loans, 10-year fixed-rate mortgages and a home equity product. These products, it said, were all well-received and have been gaining momentum in the Maltese market.
Its Dutch government-guaranteed (NHG) mortgage portfolio now represents approximately 40% of the Group’s balance sheet. In December 2021, MeDirect launched its meHomeLoan product in the Belgian market in partnership with Allianz.
The retail franchise, focused on affluent customers, grew by almost 30% over the past twelve months to more than 106,000 clients. Total client financial assets increased by almost 4% year over the year, notwithstanding very challenging market and macroeconomic conditions, reaching €4.3 billion.
"Strong trust in the MeDirect brand and its award-winning onboarding process enabled MeDirect to increase its wealth client base by 19% over the past twelve months. This growth was supported by high customer satisfaction and retention levels. Success in retaining clients is demonstrated by the fact that over 90% of clients who opened accounts with MeDirect five years ago remain with the bank," it said.