Bank of us pumps up its loan book as coronavirus bites

Customer-owned Bank of us' home loan book grew by more than 9 per cent to $923 million in 2019-20.

The bank said that was three times faster than system growth.

It approved $265 million worth of home loans (down by $14 million compared with the previous year's record), and grew market share by 15 per cent.

Total assets shot up by 16 per cent to $1.14 billion, while the bank recorded record growth in new customers, gaining more than 1000 active customers.

After-tax profit increased by 21 per cent to $2.8 million.

That was a sound result in an unprecedented low interest rate environment, chairman Stephen Brown said.

"This result includes a conservative provision of $827,000 for potential doubtful debts arising from the COVID-19 pandemic," he said.

Chief executive Paul Ranson said it was uncertain how the Tasmanian economy would perform in the short to medium term, given the effects of the pandemic.

Mr Brown said the bank had offered loan repayment deferrals to borrowers in hardship because of coronavirus.

"Deferrals reached a peak of 4.5 per cent of our loan book, but have reduced to 1 per cent at the end of September, with expectations that most borrowers will return to normal repayment arrangements over the next few months," Mr Brown said.

"The level of deferrals is significantly less than the industry average of 9 per cent."

Mr Ranson said he was proud of how the bank's employees responded to the pandemic and its disruption.

"Our people have continued to place our customers at the heart of banking and, as a result, we have ensured a strong operational resilience and achieved excellent growth, continuing the strong growth momentum from recent years," he said.

The bank said it had increased its home loan market share by 150 per cent since 2015.

However, it said Tasmania's 2018-19 trend of weaker housing finance activity continued with a 14 per cent decrease in 2019-20.

"This decline accelerated in the last quarter due to the impact of COVID-19 and we are now back at the activity levels of 2016," it said.

"While we expect that the economy will take considerable time to return to pre-COVID levels, we are optimistic about the opportunities in the Tasmanian market for us to continue to grow our market share."