Wealth management blemishes Suncorp Metway results

Suncorp Metway’s wealth management business, with a 29.3 per cent decline in profit, has tarnished what is otherwise an impressive year’s performance for the 12 months ending June 30.

In what has been a difficult market environment, wealth management contributed $41 million in net profit to the group’s overall performance - a significant reduction compared to the $58 million in net profit generated last year.

Meanwhile, the group’s banking and general insurance divisions fared better for the year.

Insurance put in a stellar year’s performance with a 111.8 per cent increase in profit, up to $233 million from $110 million, while banking profitability rose steadily 8.5 per cent - up to $318 million from $293 million per cent.

“This is an excellent general insurance result. It demonstrates the company has completed the GIO integration, delivered the targeted savings, and significantly improved efficiency and profitability,” Suncorp managing director John Mulcahy says.

Despite the tough time for its wealth management division, on a half year basis Suncorp reports that the performance of this division is improving.

“The second half profit increased by 9 per cent to $24 million, compared with the June half in 2002,” the group says in a statement.

Overall the group’s net profits for the year rose 23.5 per cent to $384 million up from $311 million in 2002. Group chairman John Story’s outlook for the coming year is just as optimistic.

“While global economic conditions are somewhat subdued, within Australia the economy appears resilient, with good growth rates and low inflation forecast to continue,” Story says.