Thank you for standing by, welcome to the MyState Limited FY 2023 results conference call. All participants are in a listen-only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the one on your telephone keypad. I would now like to hand the conference over to Brett Morgan, Chief Executive Officer. Please go ahead. Thanks, Travis. Good morning, everyone. Thanks for joining us for MyState's FY 2023 results. I'm Brett Morgan, MyState's Managing Director and CEO. With me is Gary Dickson, our CFO. Today's investor presentation was lodged with the ASX earlier this morning and is also available on our website. I'll provide an overview for the year before Gary takes you through the financial results in detail, including performance across our lending, deposit, and wealth management divisions. I'll cover our outlook and provide an update on FY 2024 targets. We welcome questions at the end of the presentation. We'll turn to slide four. MyState provides retail banking, trustee, and funds management products and services to Australians through its two brands, MyState Bank and TPT Wealth. Two years ago, we embarked on a growth strategy. I'm very pleased to say that two years in, we're on track. Our investment in marketing and distribution is delivering record levels of new customers. Our customer base has grown in Tasmania and across the eastern seaboard. We're taking market share across our key portfolios of home lending and customer deposits. Over the past two years, our home lending book has grown by 43%, with nearly two-thirds of our home loan customers now originating from the mainland Australia. Customer deposits are up 40% over the same period. Turning to slide five. To FY 2023 highlights. As you can see, MyState has performed strongly across key metrics. We've delivered above-system growth in mortgages and deposits. Home lending was up 14.1% or 2.9 times system to AUD 7.8 billion. Deposits grew 12.3% or two times system to AUD 6.2 billion. We welcomed a record 25,690 new-to-bank customers, an increase of 33% over the previous year. All of this growth was achieved whilst maintaining positive customer advocacy, as evidenced by our Net Promoter Score of +35. We've increased core earnings by more than 30% to AUD 57.7 million, the highest on record. MyState Bank has a sharply lower cost-to-income ratio, down 641 basis points to 60.8%. Our earnings per share increased 16.8% to AUD 0.355 per share. These results demonstrate the growth strategy is working. Turning to Slide six. Over the past year, Australians have experienced high inflation, cost of living pressures, and the fastest increase in interest rates in more than 30 years. Despite these challenging conditions, we continue, we continue to see strength in employment markets, housing market resilience, and most importantly, customer resilience. At MyState, I'm proud of the way our Tasmanian-based team has responded and provided support to those customers who are struggling. We've put in place programs to identify and support customers who need it. For example, we call every customer rolling off fixed rate mortgages to ensure they understand the best available options as they transition to higher repayments. Turning to slide seven. At MyState, we understand the importance of ESG. We're making tangible changes to the way we operate our business in six key areas. We now measure our most material Scope 3 financed emissions, those greenhouse gas emissions associated with resid- residential mortgage lending. We continue to encourage customers to adopt eStatements, with an additional 18,540 customers signed up for eStatements. The MyState Foundation supports more than 20 community groups focused on providing greater opportunities for youth. I'll now hand over to Gary for a detailed look at the numbers. Thanks, Brett. Good morning, everyone. Slide nine contains a snapshot of the key financial metrics of the business. As you can see, the results for the year are very positive. As Brett noted, core earnings of AUD 57.7 million were up 30.3%, while net profit after tax increased 20.2%, the highest full-year profit on record for the group. Top line revenue growth of 14.4% outstripped cost growth of 7.1%. The bank's cost-to-income ratio fell sharply by 641 basis points to 60.8%, with our investment in marketing and distribution continuing to drive MyState's growth momentum and improving our operating leverage. The group's cost-to-income ratio was 64%, an improvement of 440 basis points. In terms of MyState's balance sheet, total capital and return on equity moved positively during the year. MyState's capital position strengthened in part due to the inaugural issue of additional Tier 1 capital in August 2022, and at 8.7%, ROE is in line with our regional bank peers. The board has declared a final dividend of AUD 0.115 per share, in line with the interim dividend and equivalent to a payout ratio of 65.3% of after-tax earnings for the year. This decision is in line with our current dividend guidance range and strikes the right balance between pursuing growth while continuing to deliver shareholder returns via dividends. Slide 10 shows the key drivers of our highest full year net profit after tax result on record. Net interest income increased 20.3%, primarily due to a larger average balance sheet, partly offset by a small reduction in net interest margin. Other banking income declined 10.8%, reflecting lower loan fee income, with higher switching fees seen in the prior year, and lower transaction fee income as customers take advantage of low or no-fee products. The small decline in wealth management income was driven by lower management fees from a decline in average funds. Operating costs increased 7.1%, which I'll cover in more detail in a moment. The prior year benefited from a write back of the collective loan loss provision from COVID high levels and a gain on sale of a property held in Rockhampton. Slide eleven shows that total operating expenses increased 7.1%, driven by higher personnel, technology, and other costs, with the latter primarily volume related and due to some non-recurring items. Personnel costs were higher due to salary increases, reflecting the higher inflation environment, and FTE was flat year-on-year. Marketing spend was in line with the prior year and has been directed to customer acquisition-focused activity, which has seen a 33% increase in new-to-bank customers. Approximately two-thirds, excuse me, approximately two-thirds of which have come from the east coast of the mainland. The uplift in technology spend reflects higher software maintenance fees and Software as a Service system amortization. The uplift in other expenses of AUD 3.9 million was partly volume driven and includes lending-related costs, such as interest rate change notifications and payment system costs following the growth in customer deposits. Non-recurring items of approximately AUD 2 million includes the accelerated amortization of IT system spend. Cost pressures remain elevated and are expected to persist in the current inflationary environment, coupled with ongoing investment spend in the regulatory, cyber, data, and compliance areas. Turning to slide 13, average NIM fell 4 basis points, reflecting the competitive pricing pressure in both the home loan and retail deposit markets. Exit NIM in June 2023 was broadly in line with average NIM for the second half, at 1.54%. While we expect NIM will remain under pressure, some relief may be in sight as cashback offers are progressively withdrawn and deposit trends normalize. We will continue to carefully manage growth to optimize capital and returns. Turning to slide 14, MyState recorded strong home loan book growth of 14.1% or just under 3 times system growth. The home loan portfolio has now grown 43% since June 2021 to AUD 7.8 billion. Relative to FY 2022, home loan settlements were down 13.8%, reflecting the slowdown in system credit growth and the competitive lending environment. Our relationships with key brokers remain strong, and our competitive home loan approval times reflect the investment we have made in underwriting capacity and capability. While runoff remains a sector-wide challenge, both discharge activity and paydown levels were lower, with the overall runoff rate decreasing from 32% to 26.6% in the current year. Competitive pressure in the refinance market persists, despite cashback incentives for refinances being progressively withdrawn by many competitors. Effective April 1, 2023, MyState was one of the first banks to withdraw its cashback incentive. RBA system housing growth began to moderate in the later months of 2022, and MyState has experienced a resulting slowdown in home loan application flow. Looking forward, we expect housing credit growth to be around 4%, and we are targeting to grow the home loan book at approximately two times system. Turning to slide 15, maintaining high credit quality remains a key focus and underpins our balance sheet strength. Our focus remains on low-risk, owner-occupied lending. Loans with an LVR of less than 80% make up 75% of the total book. The growth in 85% plus LVR loans over the past three years is primarily attributable to our participation in the federal government-backed First Home Loan Deposit Scheme. Scheme loans comprise approximately 16% of the book and account for 81% of loans with an LVR greater than 85%. The charts on the right show an increase in both 30-plus and 90-plus day arrears, reflecting the rapid increase in interest rates seen since May 2022, when the RBA first increased the official cash rate from historic lows of 10 basis points to 4.1% today. Home loan customers have shown remarkable resilience to date, partly a consequence of the strong employment markets across Australia. At June 2023, 30 June 2023, MyState arrears, arrears levels continue to be below industry benchmarks, and there are only five mortgagee in possession loans for a total value of AUD 1.1 million, with no loss expected. On Slide 16, the chart on the top right highlights the increase in the total collective provision, consistent with the increase in the level of arrears and the rising interest rate environment. At 30 June, the key assumptions used to determine the forward-looking economic overlay were revised to incorporate the latest observed economic data, including a higher official cash rate, stable levels of employment, and assumed house price falls in FY 2024 and 2025. The probability of a moderate recession scenario was increased from 30% at June 2022 to 40% at December 2022, and this assumption remains unchanged at 30 June 2023. Key assumptions and the relevant scenario weightings are set out in the appendix to the Pack. While arrears levels and resulting provisioning levels have increased, the full effect of increases in the official cash rate, any future increases, and the impact of stickier inflation will continue to become more visible over coming months. Provision coverage ratios are shown in the chart, bottom left. At 30 June 2023, the ratio as a% of credit risk-weighted assets is 37 basis points. This compares to the ratio at 30 June 2019, or pre-COVID, of 30 basis points. The ratios at June and December 2021 reflect the estimated impact of COVID-19 at those points in time. Slide 17 shows that customer deposits continue to represent 73% of our funding mix, with the flagship Bonus Saver account growing during the year and customers moving to term deposits in response to rising interest rates. In line with our retail deposit-led growth strategy, MyState has grown at two times system, and to support savers, we have increased the rate on our Bonus Saver account in line with changes in the official cash rate. The issue of senior unsecured medium-term notes in October 2022 brought further tenor to the pool of wholesale funding, and in December, MyState issued its first public RMBS transaction since 2019. Turning to Slide 18, MyState's total capital ratio increased by 302 basis points, reflecting organic capital generation, the inaugural issue of additional Tier 1 capital in August 2022, and the capital relief term RMBS transaction I mentioned earlier, partly offset by growth in risk-weighted assets and capitalized origination costs. Under APRA's revised capital management framework, the total capital ratio benefited by 112 basis points, driven by the application of new credit risk weights under the revised framework and the new methodology to calculate the allowance for operational risk. The countercyclical capital buffer increased by 1% at the same time. Moving to Wealth Management on Slide 20, TPT Wealth continues to deliver a stable source of income to the group. Operating income was down 3.5% on the prior year, with lower funds management fee income reflecting a fall in average FUM. Trustee services income was also marginally lower year-on-year. Our focus remains on growing our cash and income funds with an increased allocation to direct mortgages, delivering improved returns to income fund investors. Significant opportunity remains for the locally based commercial lending team to drive a strong loan origination pipeline over the short to medium term in our Tasmanian heartland. I'll now hand you back to Brett to talk about our outlook. Thanks, Gary. I'll now take you through our outlook. Turning to Slide 22. Given the less certain macro environment, we are providing a 12-month outlook. In FY 2024, we are targeting to grow lending at two times system, and for customer deposits to remain above 70% of total funding. We will continue to invest in our business, while still maintain the improved cost-to-income ratio achieved in FY 2023. Noting the strong growth in earnings per share and return on equity over the past 12 months, we expect FY 2024 results to be in line with FY 2023. Turning to Slide 23. To wrap it all up, MyState has had a strong FY 2023. We've posted a sharply higher core earnings, up more than 30%, and a record profit of AUD 38.5 million. We've delivered strong above system growth in customer deposits and home lending. Our market share has grown significantly, with increases across Victoria, New South Wales, Queensland, and Tasmania. We've welcomed a record number of new customers, up 33% over the year, and we've done this efficiently with our bank cost-to-income falling by 641 basis points. Looking back, you can see that the growth strategy is working. We look ahead, we're optimistic that we'll continue to execute well and generate the benefits that come with scaling the business. Gary and I will now answer any questions you may have. Over to you, Travis. Thank you. If you wish to ask a question, please press star one on your phone and wait for your name to be announced. If you wish to cancel your request, please press star, then two. If you're using a speakerphone, please pick up the handset to ask your question. The first question today comes from Nathan Zaia from Morningstar. Please go ahead. Morning, Brett and Gary. I just have a few. Can you provide any further detail on the margin pressure on home loans? Like, how much is swap rates for new customers versus repricing the back book? Hi, Nathan, it's Brett. We see, so in terms of front book pricing on new customers, we've seen cashback scale back and slightly less competition in the market, in terms of other front book pricing, increasing. In terms of back book, we do see customers, you know, with the cashback offers in market, customers continue to shop around. I guess to answer your question, less front book risk. There continues to be a little back book, but our front book, back book spread are relatively tight. For our portfolio, we don't see too much impact, marginal, but a little bit, but not too much impact going forward. Okay. So you kind of answered another question I had in terms of, you know, the competition around pricing going forward. Are you expecting it to get worse or better? I was kind of hoping for some commentary around loans. I think you covered, but deposits, like, is that where more of the pressures still might come from? Yeah. I see on the lending side, probably pressure easing out a little bit. You've heard quotes from other organizations about returns from mortgage lending, so we've seen competition easing a little bit. On deposits, the interesting thing we're thinking about is the TFF. Our, our component of the TFF started at AUD 185 million. By the end of this month, it'll be sub AUD 100 million or about, you know, close to 1% of our funding. Across the market, it's much higher than that. So obviously the deposit competition is somewhat reflective of that. A big piece of that ends in the end of September, I think. A lot of pay down and before the next tranche starts. Our view is, deposit competition will, will remain relatively hot, for, you know, a very short period of time, then we'll see a bit of relief, post the pay down of the TFF. I guess the other phenomenon that's happening is, customer choice, where customers, who had traditionally sat in, you know, low interest bearing transaction accounts, are taking choices about getting a better return for themselves, which... so they should. We see that playing out a little bit. We also see ourselves being a beneficiary of that, and you can see that through our growth in new-to-bank customers. We see that sort of challenger approach, supporting our growth in customers and growth in balances as well. I, I might just add a point, Nathan. I think following the RBA, leaving the cash rate on hold in both July and August, you know, we have three of the four major bank economists suggesting that we're already at peak, peak cash rate. We have seen a back off in swap rates, and we have seen competitor starting to move their term deposit, term deposit pricing down. For example, you know, one, year TD rates coming down from sort of the early 5s into the sort of high 4.90. We are seeing a little bit of that. We've moved accordingly as well. Okay, thanks for that. It's very helpful. With the fixed rate customers, I believe you still have the bulk of yours to mature still, but is there any comment you can make how the ones that have matured are performing versus the rest of your book? Perhaps another one around that, like what percentage have an LVR above 80%? Yeah. Our fixed rate book is around 20%. A lot of it is to mature, but for those in the next sort of 12 months. For those that have, performance have been pretty good. In terms of retention, we've retained, and it's in the deck, around 73%. About, of those retained, one-quarter go back on a fixed rate, three-quarters go on a variable rate. In terms of performance, they're broadly performing in line with the portfolio. It's about the same as the portfolio in terms of arrears performance or, or customers struggling. In terms of LVRs, was that your next question? Sorry, Nathan. Yeah. If you've got that, that sort of data in terms of how they're spread, the, the fixed rate book. Yeah, we don't have it to hand, but. Okay. Yeah, we don't have it to hand. All right. The only other thing, Bendigo called out fraud, scam costs and uplifting financial crimes team. Is, is that something Westpac has experienced or something you need to be considering? Look, I mean, I think, Nathan, from our perspective, what we've seen in FY 2023 is, I mean, our, our fraud cost has not been significant, that's, that's for sure. You know, one of the things that we, we track is, you know, obviously, some of our customers have experienced loss. What we focus on a very strong program around education of customers, so that, that's an active program that we run, like, like all banks. ... sort of education, invest into prevention, invest into detection. I mean, we, we have, as Gary Dickson pointed out, there has been a small, relatively small loss for our business related to, customers impacted by scams. Customers have been also impacted, a bit like across the industry, but in terms of our, our situation, it's negligible. Thanks a lot, guys. Thank you once again. To ask a question, please press Star One on your phone. The next question comes from Alastair Hunter from Ord Minnett. Please go ahead. Thanks for your time, Brett and Gary. Just a couple of questions, if I may. Firstly, just on the capital ratio, the 11.2%, as to, to what sort of level under the new guidance you want to sort of target that in over the next years? Yeah. Hi, Alastair. I mean, we tend to... The way we think about it is we'll run our CET1 ratio at a buffer to rating agency capital requirements. From a Fitch perspective, that ratio is generally around 10%, and from a Moody's perspective, probably more like 10.5-10.75%. You'll see there, as you highlighted, the CET1 ratio was 11.22% at 30 June. In terms of a target range, we also focus on our total capital level. The board, and we disclose this in our financial statements, the board's currently set a minimum total capital ratio target of 14%. As you'll see on one of the slides there, we're currently at about 15.4%. In terms of funding the, the excess growth above what you're sort of internally generating, which I think, you know, back-solving, it's sort of around the 5%-6% you can sort of fund organically, and then the rest is needing incremental funding. What, what, what's the sort of outlook, again, mix between, I suppose, securitization markets and other capital funding opportunities? Yeah. In terms of funding the growth, it's, it's predominantly about retail deposit-led. As you point out, if you go to the chart on page 17, the funding mix, you can see that we have, over the last three years, significantly run down our securitization as a percentage of total funding. We do have appetite to move that securitization ratio back to around sort of 20%-21%. Obviously, that securitization that we do is capital relief. Just on the non-interest income side, if you can make sort of comments about outlook for both, the TPT Wealth business that seemed to, in the second half, go into loss and the banking fees as to how you see that, the customer dynamics and volume effect flowing through into the 2024 year. Yeah, I mean, from a TPT perspective, both on the funds management side and also on the trustee services side, we'd certainly be looking at, like, mid-single-digit revenue growth. What was the second part of your question? Banking fees. Oh, banking fee income. Yeah, I mean, I, I think as I sort of highlighted in the, in the presentation, we, we obviously have seen some, and this is a sector-wide thing, again, some customer behavior around switching to lower fee or no, no fee products. We'd expect that rev-revenue line to sort of broadly be in line with last year, you know, potentially growing in line with, with customer numbers. Thank you. Then finally, just I suppose on the earnings outlook that you've flagged today for sort of a flat year, is it a reasonable assumption that it somewhat reverses the pattern in half years that we've seen this year of sort of a, perhaps a flattish first half, and then growth in the second half is what we'd expect for 2024 within a flat year-on-year? Secondly, I suppose just in a longer term profitability sense, I note your disclosures today have a, have a whack in there of just under 11%, 10.9%, with your ROE being sort of full year around 8.7%. How do you see the pathway to, you know, delivering cost of capital returns across the aggregate MyState business, you know, three years horizon? Yeah, I mean, I think, think for us, Alastair, it's, it's really about that operating leverage that we've started to realize, as you can see, with the cost-to-income ratio coming down. You're quite right, when you look at it, I mean, we're effectively a monoline home loan provider. When you think about that return on equity, one of the challenges the industry faces is that it is currently below the slightly below the cost of capital. For us, it's really about driving that operating leverage, which we, you know, we see a significant opportunity to do over the medium to longer term. Then in terms of half on half, I mean, the, the, the competitive pressures that we're currently facing, the industry is facing, you know, we, we see them, as we discussed, playing out in a certain way. So your assumption would be broadly correct around we expect, you know, the near term to be a touch more challenging and then the second half to be a bit more positive. Thank you. Thank you once again. To ask a question, please press star one on your phone. We'll pause to allow parties to enter the queue. The next question comes from Louise Gregg, private investor. Please go ahead. Hi, Brett and Gary. I just... My questions are related to the dividend. Can you be able to say what is the board's dividend payout policy range? Can you also explain why the dividend's been cut in light of the results which you have described as strong, sharply higher, and record? Thanks, Louise, for the question. The dividend policy is 60% to 80% payout ratio. Mm-hmm. The board approved policy is 60%-80%. We have embarked on a growth strategy, and we're also very cognizant of the stock that we are. We strike the balance between paying out what we see as a good dividend and also retaining capital to support our growth and delivering longer term returns to shareholders as well. That's, that's the rationale for the decision around the dividend, which is paid out at about the 65% of earnings. Right. thanks for answering the question. I think from our viewpoint, an extra AUD 1 million in the dividend to keep it the same as last year, would've been perceived better than, than that, and wouldn't really move your payout ratio too far from where it currently is. Appreciate the feedback. Thank you. Thank you. At this time, we're showing no further questions. I'll hand the conference back to Brett for closing remarks. Thanks, Travis, and thanks everyone for joining us on the call today, and we look forward to catching up with, some of you in the months ahead.