Cross-Tasman portfolio growth and AI platform upgrades feature in the group’s turnaround story
Heartland Group Holdings Limited has reported a return to profitability for the first half of the 2026 financial year, citing stronger margins, improved cost control, and continued growth in its reverse mortgage business in New Zealand and Australia.
Heartland Group Holdings Limited reported a net profit after tax (NPAT) of $48.8m for the six months ended 31 December 2025, marking a turnaround for the Australasian financial services group.
On an underlying basis, half-year NPAT was $46.1m. The company reaffirmed its full-year guidance of at least $85m in underlying NPAT and an underlying return on equity (ROE) of at least 7% for the financial year ending 30 June 2026.
Heartland’s underlying ROE rose 540 basis points (bps) to 7.3%, while its average net interest margin (NIM) increased 51bps to 3.92%. The underlying cost-to-income (CTI) ratio fell 304bps to 54.6%, reflecting tighter cost management across the group.
Chief executive officer Andrew Dixson (pictured) authorised the announcement, highlighting progress in NIM expansion, asset quality, cost control, and the accelerated realisation of non-strategic assets (NSAs). Since establishing the NSA portfolio, Heartland has achieved a recovery rate of more than 90%, with the programme on track to be largely complete by 30 June 2026.
Reverse mortgage growth
Heartland Bank’s reverse mortgage portfolio in New Zealand grew 15.2% to $1.33b as at 31 December 2025. In Australia, Heartland Bank Australia’s reverse mortgage receivables rose 18.9% to A$2.17b over the same period.
The group declared an interim dividend of 3.5 cents per share, up from 1.5cps a year earlier, to be paid on 20 March 2026.
Heartland outlined investment in AI-enabled, cloud-based technology platforms across both its New Zealand and Australian banking operations. The programmes are designed to modernise and simplify technology systems, increase automation, and support scalable growth. Implementation has begun with reverse mortgages, with total costs estimated at no more than $17m over three years.
New ambassador backs the product
Separately, Heartland Bank said demand for its reverse mortgage product was rising and announced the appointment of broadcaster Judy Bailey as brand ambassador to support awareness of the offering.
Will White, general manager retail and reverse mortgages, said customers used their loans in 2025 for home renovations, debt consolidation, healthcare, vehicle upgrades, and travel.
“It has been a delight to travel the country and chat with customers who say this product has genuinely changed their lives, giving them peace of mind, freedom, and dignity,” Bailey said.
Heartland will hold an investor day on 5 June 2026 to outline its longer-term strategy and financial ambitions.
