Suncorp benefits from booming markets

Suncorp has posted a 47 per cent jump in net profit for the half year ending December, becoming the latest financial services group to ride favourable investment conditions.

The group’s banking, general insurance and wealth management divisions all contributed strongly to the $413 million in net profit the business generated in the second half of 2004.

“The problems that the group was experiencing two years ago have been fixed and the company is now fit and competitive,” Suncorp chairman John Story said.

“Supported by the solid external environment, chief executive John Mulcahy and his management team have made operational improvements over the past two years that are now flowing strongly to the bottom line,” he said.

The $413 million in net profit was up from the $281 million the group made in the corresponding period to December 2003.

The three core divisions of banking (up 24.3 per cent), insurance (up 58.6 per cent) and wealth management (up 16.7 per cent) delivered $220 million, $341 million and $42 million to the bottom line.

However despite the performance Mulcahy stressed that while the 2004/2005 financial year would see the group perform solidly, the six months to June are unlikely the reflect the second half performance of 2004.

“The first half profit was clearly a very strong result, and while we will be working hard to maintain that profit growth momentum in the current half, there were some factors in the first six months, like strong investment returns, that may not be repeatable,” Mulcahy said.