Liberty Financial Group Boosts Profit 16% and Declares Strong Dividends

Strong Profit Growth Amid Competitive Market

Liberty Financial Group (ASX – LFG) has delivered a robust financial performance for the year ended 30 June 2025, reporting a 16% increase in statutory net profit after tax (NPAT) to $133 million. Underlying net profit after tax and before amortisation (NPATA) rose by 10% to $145 million, reflecting steady operational momentum despite a challenging lending environment marked by heightened competition and economic uncertainty.

Chief Executive Officer James Boyle attributed the growth to a combination of a stable loan portfolio, an expanded net interest margin (NIM) of 2.49%, and disciplined cost management. "This positive result was achieved notwithstanding an increasingly competitive lending environment and continuing interest rate and cost of living uncertainty for customers," Boyle said.

Capital Strength and Funding Success

Liberty’s financial assets edged up 1% to $14.7 billion, underscoring the company’s steady lending footprint across residential, commercial, and personal finance sectors. The group successfully raised $4.5 billion in new funding over the year, supporting its growth ambitions while maintaining a leverage ratio of 13.6 times and an investment grade BBB credit rating with a stable outlook.

Chief Financial Officer Peter Riedel highlighted the company’s strong capital and liquidity position as a key enabler for future growth. "Our market leading net interest margin and return on equity of 12.1% demonstrate Liberty’s focus on building durable business value," he noted.

Attractive Returns for Securityholders

Liberty declared a final unfranked distribution of 20 cents per security and a fully franked special dividend of 15 cents per security, bringing total FY25 distributions to 52 cents per security. This equates to an attractive yield of 15.6% as of 30 June 2025, reflecting the company’s commitment to balancing capital optimisation with rewarding investors.

Riedel emphasized that the dividend policy aims to provide an appealing yield while supporting growth initiatives. "The distribution and special dividend declarations are in line with our policy to optimise capital for growth and provide an attractive yield for securityholders," he said.

Outlook – Confidence in Consumer Demand and Market Conditions

Looking ahead, Liberty’s management expressed optimism for FY26. Boyle pointed to signs of recovering consumer confidence across all lending products and the potential for further interest rate cuts by the Reserve Bank of Australia. Combined with ongoing strength in debt capital markets, these factors underpin the company’s confidence in sustaining growth momentum.

While the broader economic environment remains uncertain, Liberty’s solid balance sheet, disciplined approach, and diversified lending portfolio position it well to navigate the year ahead.