St George reports record profit

St George Bank has posted a record cash profit result ahead of its looming merger with Westpac.

The bank announced today that it had registered a 13.9 per cent increase in cash profit to $1,321 million for the year ended September 30, representing earnings per share growth of 8.3 per cent.

However, the bank’s wealth management division certainly felt the effects of the ongoing market volatility, with managed funds down nearly $9 billion in September 2007 to $49.7 billion this year.

The bank reported to the Australian Securities Exchange that Asgard had maintained its market position of fifth ranking in terms of funds under administration and fourth ranking based on annual net flows.

Commenting on the result, St George chairman John Curtis described it as “a solid result in a very challenging external environment”.

The bank’s chief executive, Paul Fegan, used the result to state that the directors were unanimously recommending the proposed merger with Westpac at the scheme meeting scheduled to be held on November 13.

Looking into the future, Fegan acknowledged that the outlook for the economy remained uncertain as the effects of the global credit crisis continued to spread.

However, he said that St George fully supported the Australian Government’s response to the credit crisis and its fiscal stimulus package, including the bank’s guarantee.

“These measures are extremely helpful but there are still many issues to be resolved and the situation continues to be uncertain,” Fegan said.

“We believe the Government will closely monitor the situation and may need to take further actions.”