Snoopy is talking about a reduction of revenue in certain segments, but conveniently neglects to mention earnings are up. In some people's books, the best growth is when earnings go up, not revenue.
HNZ are being selective about the business they want to fund, focusing on the cashflow positive parts of a farm (machinery, livestock), rather than funding the land itself. They don't want to contest the mortgage space with the big banks head on. They have told me directly that they are keen to work with the big banks (who also seek to partner with HNZ to help spread risk), so that HNZ fund the business, stock, plant and equipment, and ASB/ANZ/??? fund the land. It is a "symbiotic" relationship. ASB don't want to end up with a combine harvester, and HNZ don't want to fund land they are uncompetitive on. They will be most keen to lend to households for mortgages when they have a total relationship, rather than competitively quoting for every man and his dog.
HNZ have said to me that their business model is ideally 1/3 consumer, 1/3 SME+business, and 1/3 agricultural.
http://www.scoop.co.nz/stories/BU130...ed-margins.htm
http://www.stuff.co.nz/business/mone...lay-niche-role
I'm sure that a quick phone call or an email to the folks at Heartland would assist Snoopy with understanding this better than a financial statement alone. I hope Snoopy makes the call on Monday.