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MyState Limited ASX / Media release Friday 19 February 2021 MyState delivers outstanding first half result Dividend 12.5 cents per share • Core earnings growth of 18.8 % , NPAT up 12.6 % and EPS up 11.6 % • • • • • Above system lending of 5.5 % on 31 December 2019 and strong 1H deposit growth , up 5.1 % ROE up 65bps to 9.94 % Cost - to - income ratio down 340bps to 61.5 % , underpinned by strong revenue growth Consistently high Net Promoter Score driving customer growth . 19 February 2021 : MyState Limited , the banking and funds management group , today announced an outstanding first half result with 18.8 % growth in core earnings to $ 26.4m ( 1H20 : $ 22.2m ) and 12.6 % growth in statutory NPAT to $ 17.0m ( 1H20 : $ 15.1m ) . This excellent result was underpinned by above system lending growth , further improvements in the cost of funding and continued efficiency gains with benefits emerging from technology investments . MyState also achieved a peer - leading ROE of 9.94 % , up 65bps on the prior period , and impressive cost performance with the cost to income ratio falling by 340bps to 61.5 % for the half . As a result , the Board has declared an Interim Dividend of 12.5 cents per share for the half year , equivalent to a 67.6 % pay - out ratio of after - tax earnings . This decision is in line with the current dividend guidance range , striking the right balance between pursuing the significant organic growth opportunities in the business and rewarding shareholders with dividends . Managing Director and Chief Executive Officer , Melos Sulicich , said , “ This was a challenging period , however the results underlined the effectiveness of MyState's strategy : driving strong customer acquisition , increasing investment in digital innovation and managing operating expenses while maintaining a culture focused on delivering positive customer experiences . " Our decision to increase the momentum of our evolution into a digital bank and funds management business is paying off . Our ability to undertake this digital transformation quicker than many of our competitors means that our growing customer base finds we are easier and more trustworthy and intuitive to deal with , leading to stronger relationships with them . " Importantly , it allows us to scale more efficiently as competition for lending products intensifies . We are better able to refine our products to ensure they continue to suit our customer's needs , and harness resulting business opportunities so they provide maximum benefit to shareholders . " Credit quality , evidence of strong lending disciplines MyState was well positioned heading into the pandemic , given the quality of the underlying loan book . As a result , the Group remains very comfortable with the underlying credit quality . At 15 February 2021 , less than 200 customers remain on some form of COVID related assistance , with the majority being home loan customers representing about 1.6 % of total home loan balances ( down from a peak of 10.9 % in June 2020 ) . Given the change in economic conditions , the forward looking credit loss overlay has been reduced from $ 2.5m at 30 June 2020 to $ 1.6m , supported by a more positive economic outlook . Page 1 of 4