Heartland announces half year NPAT of $47.5 million

1
NZX/ASX release
22 February 2022

Heartland announces net profit after tax of $47.5 million
for the six months ended 31 December 2021

Heartland Group Holdings Limited (Heartland) (NZX/ASX: HGH) achieved a net profit after tax
(NPAT) of $47.5 million for the six-month period ended 31 December 2021 (1H2022), an increase of
$3.4 million (7.8%) compared with the six-month period ended 31 December 2020 (1H2021). On an
underlying basis (which excludes the impacts of one-offs
1
), 1H2022 NPAT was $47.1 million, an
increase of $3.8 million (8.8%) compared with 1H2021 underlying NPAT.

The first half performance included a pleasing annualised rate of growth in lending (13.9%
2
). It also
demonstrated the benefits of ongoing digitalisation, with a reduction in the cost-to-income (CTI)
ratio.

Impairments were up on 1H2021 (19 basis points (bps)) due to COVID-19 related extensions
3
that
occurred in 1H2021. This was largely successful as reflected in the ‘business as usual’ reported rate
of 33 bps for 1H2022, which is below the six months to 30 June 2021 (2H2021) (43 bps contributing
to the full year outcome of 31 bps) and the financial year ended 30 June 2020 (FY2020) (65 bps).

The introduction of changes to the New Zealand Credit Contracts and Consumer Finance Act 2003
and the Credit Contracts and Consumer Finance Regulations 2004 (CCCFA) slowed growth in Motor
and online Home Loans in January and February 2022. This has the potential to impact on the
growth rate for the remainder of the six-month period ending 30 June 2022 (2H2022). This is being
partially offset by growth in other areas, especially Reverse Mortgages in Australia and New Zealand,
and no material reduction in anticipated full year growth is expected.

Highlights for 1H2022
‒ NPAT of $47.5 million, up 7.8% ($3.4 million). Underlying NPAT of $47.1 million, up 8.8% ($3.8
million) on 1H2021 underlying NPAT.
‒ One-off items had a $0.5 million net impact on NPAT, consisting of $1.1 million of one-off net gains
and $0.9 million of one-off expenses
4
.
‒ Gross finance receivables
5
of $5.4 billion, up 13.9%
2
($339.4 million).
‒ Return on equity of 12.2%, up 7 bps.
‒ Net interest margin
6
of 4.30%, up 3 bps.
‒ Net operating income of $130.7 million, up 4.3%.
‒ CTI ratio of 43.8%, down 5.0 percentage points (pps). Underlying cost to income ratio of 43.1%,
down 2.7 pps.
‒ Impairment expense as a percentage of average receivables increased from 0.19% in 1H2021 to
0.33% in 1H2022.
‒ 1H2022 interim dividend of 5.5 cents per share (cps), an increase of 1.5 cps from 1H2021.

1
Underlying results exclude the impacts of one-offs. Refer to ‘Profitability’ on pages 3 and 4 for details.
2
Annualised 1H2022 growth excluding the impact of changes in foreign currency exchange (FX) rates.
3
These extensions included those provided under the Heartland Extend product and the New Zealand
Government’s Business Finance Guarantee Scheme (BFGS).
4
Refer to ‘Profitability’ on pages 3 and 4 for details.
5
Gross finance receivables (Receivables) include Reverse Mortgages.
6
NIM is calculated based on average gross interest earning assets.

2
‒ Earnings per share of 8.1 cps, up 0.5 cps.
‒ Progress in digitalisation and continuous integration of product applications and platforms has
provided faster processes and the ability to offer market-leading rates across New Zealand and
Australia.
‒ Heartland Bank Limited (Heartland Bank) was awarded Canstar Savings Bank of the Year 2021 (for
the fourth consecutive year), and 5-Star Ratings for Outstanding Value for its Direct Call and
YouChoose accounts.
‒ Australian Reverse Mortgages received two Excellence Awards at the Australia Mortgage Awards
2021 (Non-Bank of the Year and Most Effective Digital Strategy – Lender), and won a 5-Star Lender
Award in Your Mortgage’s Mortgage of the Year Awards 2021.
‒ New Zealand Reverse Mortgages awarded Consumer Trusted Accreditation (for the fifth consecutive
year).

Strategic vision
Heartland’s strategic vision is to create sustainable growth and differentiation by providing best or only
products delivered through scalable digital platforms. There are four strategic elements underpinning
Heartland’s strategic positioning:

1. Business as Usual growth (reported on within ‘Business performance’ from page 5)
2. Frictionless Service at the Lowest Cost
3. Expansion in Australia
4. Acquisitions which fit with and add value to the above.

Frictionless Service at the Lowest Cost

Heartland’s ongoing focus on digital distribution is providing improved reach and customer experience
across integrated platforms, with online access available for almost all of Heartland’s products in New
Zealand and Australia.

The Home Loans platform, launched in October 2020, reached $218.5 million of lending across 422
customers as at 31 January 2022. This online offering has enabled Heartland to consistently provide
customers with market-leading or highly competitive rates. The ambition is for the Home Loans book to
reach $1 billion of lending by the end of the 2023 financial year.

At the same time, the aim is to enhance customer experience by removing friction and creating scale
without costly processes. This will be achieved through automation, self-service digital platforms and
mobile apps. Development is ongoing, and a mobile app will soon be available to support Reverse
Mortgage customers in Australia.

Expansion in Australia

Growth in Australia continues to be a strategic priority, and Heartland is exploring potential acquisitions
as part of this.

Market share in Reverse Mortgages Australia continues to grow, increasing from 28% to 31% over the
past 12 months
7
. In addition, Heartland has expanded its appeal through the launch of Express Reverse
Mortgages in January 2022. This streamlined loan, with a market-leading variable interest rate, targets
homeowners aged 60 to 70.

7
Based on APRA ADI Property Exposure and Heartland Reverse Mortgages data at 30 September 2020 and 30
September 2021.

3
COVID-19
Heartland is following government guidance and taking a cautious approach to ensure the safety of its
people, customers and strength of its business. Heartland’s ongoing digitalisation of customer and
product platforms is supportive of this cautious approach, ensuring customers can continue to engage
with Heartland remotely.

Additional economic pressures are also being faced, including the steepening interest rate environment,
higher cost of labour, and inflation increasing globally, with New Zealand recently experiencing its largest
movement in the consumer price index since 1990.

Despite this, the higher levels of growth experienced by Heartland in 2H2021 has continued through
1H2022. As in previous periods, the impact of the pandemic has not disrupted business as usual activity,
noting that the demographics most affected by COVID-19 are under-represented in Heartland’s customer
base.
8


Heartland’s COVID-19 economic overlay of $9.6 million, taken in FY2020, remains unutilised as the impact
of COVID-19 on Heartland’s portfolios has been more benign than initially forecast. The overlay does not
represent any actual losses, but was taken to provide a buffer against any future losses that the
uncertainty of COVID-19 may give rise to.

In the current operating environment, a release of the COVID-19 economic overlay is not yet appropriate
and the overlay has been retained in full. Heartland’s COVID-19 economic overlay remains in place and
available to be applied to any losses stemming from the pandemic.

Financial results
Profitability

NPAT was $47.5 million, a $3.4 million (7.8%) increase on 1H2021. Underlying NPAT was $47.1 million, a
$3.8 million (8.8%) increase on 1H2021.

Return on equity (ROE) was 12.2%, up 7 bps from 1H2021. Underlying ROE was 12.1%, up 21 bps from
1H2021.

Earnings per share (EPS) was 8.1 cents per share (cps), up 0.5 cps from 1H2021. Underlying EPS was 8.0
cps, up 0.6 cps from 1H2021.

1H2022 reported results include one-off items which should be considered when analysing the underlying
result. The impact of these one-off items on the respective financial metrics is outlined in the table below.


8
Heartland’s total exposure to the retail, accommodation and transport (excluding road freight transport) industries
at 31 December 2021, based on borrower ANZSIC codes, was 1.84%, 1.50% and 1.22% respectively. Heartland’s
exposure to customers aged 15-24 years (those most affected by increases in unemployment) at 31 December 2021
was 3.91% in Motor and 6.10% in Personal Lending.

Heartland Group Holdings Limited | 0800 85 20 20 | PO Box 9919, Newmarket, Auckland 1149 | shareholders.heartland.co.nz
4

Reported Underlying
1H2022 1H2021 Movement 1H2022 1H2021 Movement
Net operating income
(NOI)
9
($m)
130.7 125.3 5.4 130.8 120.1 10.7
Operating expenses ($m) 57.3 61.1 (3.8) 56.4 55.1 1.4
NPAT ($m) 47.5 44.1 3.4 47.1 43.3 3.8
Net interest margin (NIM) 4.30% 4.28% 3 bps 4.30% 4.28% 3 bps
NIM excl. liquid assets
10
4.63% 4.65% (2 bps) 4.63% 4.65% (2 bps)
CTI 43.8% 48.8% (5.0 pps) 43.1% 45.8% (2.7 pps)
Impairment expense ratio 0.33% 0.19% 13 bps 0.33% 0.19% 13 bps
ROE 12.2% 12.2% 7 bps 12.1% 11.9% 21 bps
EPS 8.1 cps 7.6 cps 0.5 cps 8.0 cps 7.4 cps 0.6 cps

Income

Total NOI was $130.7 million, an increase of $5.4 million (4.3%) from 1H2021.
Excluding the impact of one-offs
11
, underlying NOI was $10.7 million (8.9%) higher half-on-half. This was
due to a $10.7 million (9.4%) increase in net interest income, driven by a $460.3 million (8.8%) higher
average interest earning assets in 1H2022 than in 1H2021, and a 3 bps increase in NIM compared with
1H2021. Underlying other operating income remained stable half-on-half.

Expenses

Operating expenses were $57.3 million, a decrease of $3.8 million (6.3%) on 1H2021. Excluding the
impact of one-offs, the underlying operating expenses were $1.4 million (2.5%) higher compared with
1H2021.
Higher underlying operating expenses were primarily due to a $1.9 million (26.9%) increase in IT and
communication expenses driven by software amortisation and licencing costs as a result of continued
investments in technology and digital capabilities.
The CTI ratio decreased to 43.8%, down 5.0 pps compared with 1H2021. The underlying CTI ratio
decreased 2.7 pps to 43.1%. It is expected to continue trending downwards.

Impairment expense

Impairment expense increased by $4.0 million (88.1%) to $8.5 million, reflecting the benefit of post-
COVID-19 remediation activity which occurred in 1H2021, together with a return to more normal levels of
asset growth and associated provisioning in 2H2021, continuing into 1H2022.

Lower impairments in 1H2021 of 19 bps were due to COVID-19 related extensions (including under the
Heartland Extend product or the New Zealand Government’s BFGS). These were largely successful in

9
NOI includes fair value gains/losses on investments.
10
NIM is calculated based on average gross interest earning assets excluding liquid assets.
11
1H2021 one-offs include $5.2 million of fair value gains on investments. 1H2022 one-offs include $0.1 million of
net fair value loss on investments.

Heartland Group Holdings Limited | 0800 85 20 20 | PO Box 9919, Newmarket, Auckland 1149 | shareholders.heartland.co.nz
5
allowing time for borrowers to remediate, as reflected in the ‘business as usual’ reported rate of 33 bps
for 1H2022, which is below 2H2021 (43 bps contributing to the full year outcome of 31 bps) and FY2020
(65 bps).

Financial position

Total assets increased during 1H2022 by $315.8 million (5.6%), driven by a $339.4 million (13.9%)
12

increase in Receivables, offset by a $36.0 million (6.7%) decrease in liquid assets.

Receivables growth was experienced primarily in Home Loans, Australian Reverse Mortgages, Motor,
New Zealand Reverse Mortgages, Business Relationship and Asset Finance, partly offset by decreases in
the Harmoney Corp Limited (Harmoney) originated personal loan portfolio, Open for Business (O4B) and
Rural Relationship. With the continued tilt of the Receivables portfolio mix towards higher quality and
lower risk assets, maintaining the current levels of NIM will pose a challenge in the coming periods. This,
however, is expected to be mitigated by a lower cost origination model and impairment expense
benefitting from an improved book quality.
Borrowings
13
increased by $290.8 million (6.0%). Deposits increased $149.0 million, and other funding
increased $141.8 million, primarily due to growth in Australian Reverse Mortgages.
Net assets increased by $16.5 million to $778.2 million. Net tangible assets (NTA) increased by $8.9
million to $687.4 million, resulting in an NTA per share of $1.17 (30 June 2021: $1.16).

Business performance
Asset Finance

Asset Finance lending NOI was $15.8 million, an increase of $2.4 million (17.9%) compared with 1H2021.
Asset Finance Receivables increased $35.7 million (12.4%)
12
to $606.6 million. The underlying demand
from transport, logistics and other productive sectors has remained consistent.

Wholesale Lending
14


Wholesale Lending NOI was $15.7 million, an increase of $3.5 million (28.8%) compared with 1H2021.
Wholesale Lending Receivables increased $38.4 million (13.7%)
122
to $593.4 million. Contributing to this
growth was a funding facility provided to Go Car Finance in 2H2021 for its New Zealand loan book, along
with the expansion of wholesale motor vehicle dealer groups. This aligns with Heartland’s strategy to
diversify distribution in motor vehicle finance.

O4B

O4B NOI was $7.2 million, a decrease of $0.3 million (4.2%) compared with 1H2021. This reflects still
subdued confidence resulting from COVID-19 related lockdowns and travel restrictions.


12
Annualised 1H2022 growth excluding the impact of changes in FX rates.
13
Includes retail deposits and other borrowings.
14
Wholesale Lending includes what was formally known as Business Relationship, reflecting Heartland’s strategy in
this sector.

Heartland Group Holdings Limited | 0800 85 20 20 | PO Box 9919, Newmarket, Auckland 1149 | shareholders.heartland.co.nz
6
O4B Receivables decreased $6.8 million (9.3%)
12
to $137.7 million. The availability of the New Zealand
Government’s COVID-19 support packages for small businesses slowed growth in this segment from the
six-month period to 30 June 2020 (2H2020) and continues to feature.

Motor

Motor NOI was $36.4 million, an increase of $3.4 million (10.4%) compared with 1H2021.

Motor Receivables increased $57.1 million (8.8%)
12
to $1,350.8 million. Increases were driven by organic
growth from Heartland’s existing dealer network, increase in intermediaries, and key partnerships
through Heartland’s 'white label' strategy. Franchises contributed 48.2% of origination as new car sales
recovered in 2021 after record lows in 2020.

Personal Lending

Total portfolio NOI was $5.4 million, a decrease of $3.4 million (38.8%) compared with 1H2021.
Harmoney NOI was $3.9 million, a decrease of $3.0 million (43.3%) compared with 1H2021.
Total portfolio Receivables decreased by $45.7 million (68.5%)
12
, with the New Zealand Harmoney
portfolio contracting $38.0 million (98.1%)
12
to $38.8 million, while the Australian Harmoney portfolio
decreased by $18.1 million (73.7%)
12
to $30.7 million. Both the New Zealand and Australian portfolios
continued to contract in 1H2022 as a result of high repayments combined with limited growth.
Home Loans

Heartland’s digital Home Loans channel experienced strong growth in 1H2022, with Receivables
increasing $163.2 million (649.2%)
12
to $213.1 million in 1H2022.
Lending growth continued to be supported by Heartland’s low interest rates, currently market-leading for
2- and 3-year fixed rates, as well as for its standard floating rate. Positive momentum is expected to
resume following the usual slowdown over the summer holiday period. This will be assisted by a new
intermediary partnership currently being piloted with NZ Financial Services Group (NZFSG) under the
‘Engage Home Loans’ white label brand. NZFSG is the largest mortgage broker aggregator in the country,
with a network of around 900 residential mortgage advisors.

Rising interest rates motivated many home loan borrowers to review their mortgage providers, driving an
increase in the volume of home loan applications received by Heartland. More than 7,840 applications
were received during 1H2022, an increase of 29.2% on the 6,067 applications received during 2H2021.

Rural

Rural lending NOI was $15.5 million, which remained stable compared with 1H2021.
Receivables decreased by $2.5 million (0.9%)
12
to $584.1 million. This is made up of a decrease in
Livestock Receivables of $12.9 million (23.5%)
12
to $96.4 million, partly offset by a $10.4 million (4.3%)
12

increase in Rural Receivables to $487.7 million.
While the balance date position for Livestock reflects seasonal lows and low utilisation rates (impacted by
climatic conditions), the average receivables position through the period was up 7.1% on 31 December
2020. Total approved limits have also increased by $15.6 million (8.0%) to $211.3 million since 30 June
2021 ($195.7 million).

Heartland Group Holdings Limited | 0800 85 20 20 | PO Box 9919, Newmarket, Auckland 1149 | shareholders.heartland.co.nz
7
Growth in approved limits and receivables has continued through January and February (limits are up a
further $8.5 million and the book balance is up $5.3 million as at 18 February 2022), supporting
Heartland’s positive outlook for Livestock through to 30 June 2022.
Results from the Sheep & Beef Direct platform introduced in 1H2021 have been positive, with $54.8
million of growth in 1H2022. Plans are underway to pilot Dairy Direct, a digital platform responding to the
growing need for dairy farmers to have access to online finance, similar to Heartland’s Sheep & Beef
Direct.
New Zealand Reverse Mortgages

New Zealand Reverse Mortgages NOI was $15.3 million, an increase of $4.1 million (36.6%) compared
with 1H2021 due to record asset growth and improved margins.
Receivables increased $47.4 million (15.6%)
12
to $648.9 million, exceeding growth in the entire financial
year ended 30 June 2021 (FY2021), due to:
‒ strong new business which was 69% higher than 1H2021
‒ increased awareness and acceptance of reverse mortgages as a solution to help older home owners
to live a more comfortable retirement
‒ continued enhancement of the product and application process
‒ favourable market conditions with higher house prices and low interest rates
‒ positive forward indicators, with enquiry levels up 65% in the 2021 calendar year, and the customer
pipeline at 31 December 2021 more than triple that at 31 December 2020.

Australian Reverse Mortgages

NOI was $19.0 million, an increase of $0.9 million (4.7%) compared with 1H2021.
Receivables increased by $65.4 million (12.1%)
12
to $1.14 billion. New business was strong, driving higher
than expected new lending, due to a buoyant property market and repayments below long-term averages
in December. The direct channel experienced 18% growth in new business compared with 1H2021, while
the intermediary channel experienced 8% growth in new business during the same period (intermediaries
now contribute 51% to new loan origination).

Australian Reverse Mortgages continued an engaged relationship with the broker channel, including
ongoing relationships with mortgage aggregators in Australia, partnerships with Australian Finance
Group, Choice Aggregation and PLAN Australia, and being added to FAST Aggregation’s lender panel in
July 2021.

Impact of CCCFA changes

The introduction of new CCCFA responsible lending regulations in December 2021 has had an industry-
wide impact on decline rates, resulting in reduced lending volumes. The interrogation of activity in bank
statements needed to satisfy the new standards has been well publicised and, amongst other things, has
slowed down loan processing.

Heartland is engaged with the Ministry of Business, Innovation & Employment and the Commerce
Commission in explaining the impact of the changes on Heartland and its prospective customers, and
awaits the output of the ministerial review currently underway.

Heartland Group Holdings Limited | 0800 85 20 20 | PO Box 9919, Newmarket, Auckland 1149 | shareholders.heartland.co.nz
8
Funding and liquidity
Heartland increased borrowings by $290.8 million (6.0%), contributed to by increases in both New
Zealand and Australia.

New Zealand

Heartland Bank increased borrowings by $236.4 million (6.4%).

Deposits grew $117.0 million (3.6%), primarily driven by a $299.6 million increase in Heartland Bank’s 32-
Day Notice Saver product which was launched in July 2021 at a market-leading rate.

Call deposits decreased by $114.5 million (12.1%), which decreased the call to total deposit ratio to 26%
as at 31 December 2021 (30 June 2021: 30%), providing a significant opportunity to attract lower cost
deposits during the second half of the financial year.

Term deposits decreased $66.0 million (3.0%), while retention remained strong at over 87%.

Other borrowings increased $119.5 million (23.8%) primarily due to a $126.6 million increase in
securitisation funding. This was as a result of higher utilisation following an increase in Heartland Bank’s
committed auto warehouse facility from $300 million to $400 million in September 2021.

Heartland Bank decreased total liquidity by $36.3 million (7.7%), reflecting a return to more normalised
levels with regulatory liquidity ratios well in excess of regulatory minimums.

Heartland Bank’s capital position progressively increased during 1H2022, reflecting its continued strong
profitability and the Reserve Bank of New Zealand (RBNZ) restrictions on distributions imposed in
2H2020. As a result, Heartland Bank’s regulatory capital ratio was 13.98% as at 31 December 2021 (30
June 2021: 13.88%), well in excess of regulatory minimums of 10.50%, providing a strong platform for
growth and for Heartland Bank to meet the RBNZ’s future higher capital requirements. These
requirements are for a core capital ratio of 11.50% and a total capital ratio of 16.00% by 1 July 2028.

Australia

The Heartland Australia group (comprising Heartland Australia Holdings Pty Ltd and its subsidiaries)
increased borrowings by A$32.9 million (3.0%), largely as a result of new issuance of an A$45 million
Medium Term Note (MTN) issued in July 2021 to support growth in the portfolio.

Both of Heartland Australia’s reverse mortgage funding warehouses are in the process of being expanded,
including the introduction of a new mezzanine funder, and extended from their current maturity dates.

Regulatory update
A significant volume of regulatory change continues. Changes to the CCCFA came into force on 1
December 2021 (with the effective date slightly delayed due to COVID-19). Heartland has implemented
new processes, including employing new technologies such as bank statement retrieval, to enable it to
comply with the changes, and continues to refine these.

New legislation (to be known as the Deposit Takers Act) is being developed to strengthen the regulatory
framework for all institutions that take deposits (including Heartland Bank), and introduce a new deposit
insurance scheme, overseen by the RBNZ. An exposure draft of the Deposit Takers Bill has been received.
Heartland is involved in submissions on the exposure draft through the New Zealand Bankers Association.

Heartland Group Holdings Limited | 0800 85 20 20 | PO Box 9919, Newmarket, Auckland 1149 | shareholders.heartland.co.nz
9
Sustainability update
Heartland’s sustainability goals for the financial year ended 30 June 2022 (FY2022) can be found on page
66 of Heartland’s FY2021 Annual Report, and also found at shareholders.heartland.co.nz. Heartland’s
sustainability strategy is built on three key pillars: environmental conservation, social equity and
economic prosperity. The below outlines Heartland’s progress towards its sustainability goals in 1H2022.

Environmental conservation

‒ FY2021 emissions will be formally reported in the FY2022 Annual Report. Further Greenhouse Gas
(GHG) emissions reductions are expected through FY2021 and 1H2022, due in part to deliberate
emissions reduction activity and the impact of COVID-19 on increased remote working.
‒ Hybrid vehicles placed on order to replace all internal petrol/diesel 4WD vehicles (equating to 23% of
Heartland’s total fleet), with deliveries expected to be completed by June 2022. Heartland intends to
start the process of replacing the remainder of its petrol engine fleet during the 2022 calendar year.
‒ Continued to provide finance for electric and hybrid vehicles through ‘white label’ partners who have
committed to increasing the number of electric and hybrid vehicle options available in the market.

Social equity

‒ Rainbow Tick accreditation achieved in November 2021, creating an environment where people feel
comfortable bringing their whole selves to work.
‒ Three new members joined the Rangatahi Advisory Board, a shadow board for employees aged 35
and under, focused on progressing key business initiatives, co-chaired by two of Heartland’s
emerging leaders.
‒ Now in its fifth year, the Manawa Ako internship programme continued virtually in January and
February 2022, welcoming 26 Māori and Pasifika interns to Heartland Bank.

Economic prosperity

‒ Total shareholder return (TSR) was 128.9% over the last five years (17 February 2017 – 17 February
2022) compared with the NZX50 Index TSR of 80.7% in the same period.
‒ Maximum loan-to-value ratios (LVR) were increased on Heartland’s New Zealand and Australian
Reverse Mortgage products – the first time LVR limits have increased since 2004, providing
customers with increased opportunity to live a more comfortable retirement.

Interim dividend
Heartland is pleased to declare a 1H2022 interim dividend of 5.5 cps (1.5 cps up on 1H2021) despite the
partial dividend restrictions imposed by the RBNZ on distributions by banks remaining in force until 1 July
2022. Heartland’s interim dividend yield of 7.4%
15
compares with 4.8%
16
in 1H2021.

The interim dividend will be paid on Wednesday 16 March 2022 (Payment Date) to shareholders on the
company’s register as at 5.00pm on Wednesday 2 March 2022 (Record Date) and will be fully imputed.


15
Total fully imputed dividends for 1H2022 (interim) and 2H2021 (final) divided by the closing share price as at 14
February 2022 of $2.35.
16
Total fully imputed dividends for 1H2021 (interim) and 2H2020 (final) divided by the closing share price as at 9
February 2021 of $1.88.

Heartland Group Holdings Limited | 0800 85 20 20 | PO Box 9919, Newmarket, Auckland 1149 | shareholders.heartland.co.nz
10
Heartland has a Dividend Reinvestment Plan (DRP), giving eligible shareholders the opportunity to
reinvest some or all of their dividend payments into new ordinary shares. The DRP will apply to the final
dividend with a 2.0% discount
17
.

The DRP offer document and participation form is available on Heartland’s shareholder website at
shareholders.heartland.co.nz/shareholder-resources/dividends.

Looking forward
Following the momentum experienced in 2H2021, Heartland’s 1H2022 NPAT exceeded expectations,
despite a challenging backdrop of continued COVID-19 impacts and legislative disruption.

Strong asset growth has been achieved in 1H2022, though growth in 2H2022 is expected to slow in Motor
and online Home Loans as a result of the CCCFA legislation impacts. The continued shift in portfolio mix
toward higher quality and lower risk assets is also expected to impact NIM in 2H2022, however it is
anticipated this will be mitigated as operational efficiency and asset quality continue to improve.

Increased digitalisation and automation have continued to increase Heartland’s ability to pass cost-
savings to customers in the form of market-leading or competitive rates, thereby leading to the CTI ratio
trending downwards. It is anticipated that this will continue through 2H2022.

Heartland expects NPAT for FY2022 to be within the guidance range of $93 million to $96 million.


– ENDS –


For further information, please contact the person(s) who authorised this announcement:

Jeff Greenslade
Chief Executive Officer
027 382 0023
jeff.greenslade@heartland.co.nz
Level 3, Heartland House, 35 Teed Street, Newmarket, Auckland, New Zealand

Andrew Dixson
Chief Financial Officer
021 263 2666
andrew.dixson@heartland.co.nz
Level 3, Heartland House, 35 Teed Street, Newmarket, Auckland, New Zealand

For media enquiries, please contact:

Shannon Morrison
Communications Manager
shannon.morrison@heartland.co.nz
021 969 310


17
That is, the strike price under the DRP will be 98.0% of the volume weighted average sale price of Heartland
shares over the five trading days following the Record Date. For the full details of the DRP and the Strike Price
calculation, refer to Heartland Group Holdings Limited DRP offer document dated 10 December 2018.

---

2022
Half year
results
22 February 2022

Important
notice
2
This presentation has been prepared by Heartland Group
Holdings Limited (NZX/ASX: HGH) (the Companyor Heartland)
for the purpose of briefings in relation to its financialstatements.
The presentation and the briefing (together the Presentation)
contain summary information only, which should not be relied on
in isolation from the full detail in the financialstatements.
The information in the Presentation has been prepared with due
care and attention. However, no person (including the Company
and its directors, shareholders and employees) will be liable to
any other person for any loss arising in connection with the
Presentation.
The Presentation outlines a number of the Company’s forward-
looking plans and projections. Those plans and projections reflect
current expectations, but are inherently subject to risk and
uncertainty, and may change at any time. There is no assurance
that those plans will be implemented or that projections will be
realised.
No person is under any obligation to update this presentation at
any time after its release or toprovide further information about
theCompany.
The information in this presentation is of a general nature and
does not constitute financial product advice, investment
advice or any recommendation. Nothing in this presentation
constitutes legal, financial, tax or otheradvice.
Non-GAAPmeasures
This presentation contains references to non-GAAP measures
including underlying profit or loss, underlying ROE, underlying CTI
ratios and underlying EPS. A reconciliation between reported and
the non-GAAP measure of underlying financial information is
included on page 32.
Because Heartland complies with accounting standards, investors
know that comparisons can be made with confidence between
reported profits and those of other companies, and there is
integrity in Heartland’s reporting approach. These non-GAAP
figures are provided as a supplementary measure for readers to
assess Heartland’s performance alongside NZ GAAP reported
measures, where one-offs, both positive and negative, canmake
it difficult to compare profits between years. However, these do
not have standardisedmeanings and should not be viewed in
isolation nor considered a substitute for measures reported in
accordance with NZGAAP.
Non-GAAP financial information has been subject to review by
KPMG.

1H2022
highlights
3

Financial highlights
1
Refer to Appendix 3 for reconciliation between reported and underlying net profit after tax (NPAT)result.
2
OOI includes fair value gains/losses oninvestments.
3
Gross finance receivables (Receivables) also include ReverseMortgages.
4
Annualised1H2022 growth excluding the impact of changes in foreign currency exchange (FX) rates.
$5,358m
GROSS FINANCERECEIVABLES
3
+13.9%
4
vs June2021
$5,155m
BORROW IN G S
+6.0% vs June2021
$778m
EQUITY
+2.2% vs June2021
0.33%
IMPAIRMENT EXPENSERATIO
5
+ 13 bps vs 1H2021
FINANCIAL
PERFORMANCE
$47.5m
$47.1m(+8.8%)
on an underlyingbasis
Underlying other
operating income
(OOI) $6.9m(flat
vs1H2021).
Net interestmargin
(NIM) 4.30% (+3 basis
points (bps)vs1H2021).
Averageinterest
earningassets
+$335.2m(+6.2% vs
June 2021).
Cost to income (CTI)ratio 43.8%
(-5.0 percentage points(pps) vs
1H2021).
Underlying operatingexpenses
(OPEX)$56.4m (+2.5% vs
1H2021).
Underlying CTIratio 43.1%(-2.7
ppsvs1H2021).
Net interest income
$123.9m
+9.4% vs 1H2021
NPAT
1
+7.8% vs 1H2021
8.1 cps
EARNINGS PER SHARE
+0.5 cents per share (cps) vs 1H2021
12.2%
RETURN ON EQUITY
+7 bps vs 1H2021
4
FINANCIAL
POSITION
FINANCIAL RETURN
43.8%
COST TO INCOME RATIO
-5 ppsvs 1H2021
4.30%
NET INTEREST MARGIN
+ 3 bps vs 1H2021
5
Impaired asset expense as a percentage of averagereceivables.
Impairments up on 1H2021 due to
COVID-19 related extensions that occurred
in 1H2021.
13.0%
EQUITY/TOTAL ASSETS
-43 bpsvs June2021

Strategic highlights
5
NZ Reverse Mortgages remains Consumer
Trustedfor the fifthyear in arow.
Continued emissions reductions activity,
including replacing 23% of total fleet with
hybrid vehicles.
Heartland Bank awarded Canstar’s 2021
Savings Bank of the Year(fourth year), and
awards for Direct Call and YouChooseaccounts.
Significant progress towards digitalisation goals
with continuous integration of product
applications and platforms.
Australian Reverse Mortgagesawarded
Excellence Awards at Australia Mortgage
Awards 2021, and won a 5-Star Lender Award in
Your Mortgage’s Mortgage of the Year Awards
2021.
Rainbow Tick achieved in November 2021.
Manawa Akointernship programme (in its
fifth year)continued virtually in January 2022.

Impairmentsand
provisioning
COVID-19
•Impairment expense increased by $4.0 million (88.1%) to $8.5 million.
•Impairment expense as a percentage of average receivables increased
from 0.19% in 1H2021 to 0.33% in 1H2022.
•Lower impairments in 1H2021 of 19 bps weredue to COVID-19 related
extensions that occurred in 1H2021.
•Extensions were largely successful in allowing time for borrowers to
remediate, as reflected in ‘business as usual’reported rate of 33 bps for
1H2022 which is below 2H2021 (43 bps contributing to the full year
outcome of 31 bps) and FY2020 (65 bps).
•The impact of COVID-19 has not disrupted business as usual activity.
•Heartland is following government guidance and taking a cautious
approach to ensure the safety of its people, customers and strength of its
business.
•A degree of caution exercised due to the ongoing economic impacts of
COVID-19 andadditional economic pressures being faced –including
steepening interest rate environment, higher cost of labour and
inflation increasing globally.
•In the circumstances, a release of the COVID-19 economic overlay is not
yet appropriate and the overlay has been retained in full.
6

Financial
results
7

Growth in profitability
8
↗ 3.4 (7.8%)
↗ 3.8 (8.8%)
0.8
0.5
5.3
5.2
0.3
1H2021 one-offs:
$5.2m fair value gain on equity
investments
1H2022 one-offs:
$0.1m net fair value loss on equity
investments
1H2021 one-offs:
$4.3m voluntarily accelerated amortisation
$1.7m aged items write-off and provision
$0.1m other non-recurring items
1H2022 one-offs:
$0.9m other non-recurring items
1H2022 one-offs:
$1.2m tax adjustments related to prior
periods
10.7
44.1
47.5
(4.0)
(1.8)
(5.3)
3.8
Note: The graph shows 1H2022growth in receivables by portfolio excluding the impact of changes in FX rates. Relative growth is annualised. All figures inNZ$m.
1
One-off impacts
+20%
33.1
39.9
44.1
47.5
40.5
32.1
42.9
6.9
FY19FY20FY21FY22
NPAT
H1H2COVID-19 Overlay
+8%
+11%
+20%
1. Post-tax impact of $9.6m economic overlay due toCOVID-19.
1

Growth in receivables
9
Note: The graph shows 1H2022growth in receivables by portfolio excluding the impact of changes in FX rates. Relative growth is annualised. All figures inNZ$m.
↗ $351m (13.9%)
12.1%
5,018
5,369
65
47
-
57
36
(7)
38
10
(13)
(46)
162
June 21AU Reverse
Mortgage
NZ Reverse
Mortgage
Asset FinanceOpen for
Business
Wholesale
Lending
Rural
Relationship
LivestockMotorPersonal
Lending
Retail
Mortgages
Dec 21
13.7%
15.6%
8.8%
543.7%
4.3%
12.4%
(68.5%)
(9.3%)
(23.5%)

Note:
•NIM is calculated as net interest income/average gross interest earning assets.
•Underlying CTI excludes one-off impacts. Refer to Appendix 3 for reconciliation between reported andunderlying result.
•Impairment expense ratio is calculated as impairment expense/average gross finance receivables.
•Adjusted impairment expense ratio excludes the impact of the $9.6millionpre-tax economic overlay due toCOVID-19.
10
Key
performance
measures
4.33%
4.28%
4.35%
4.30%
4.59%
4.65%
4.69%
4.63%
Jun-20Dec-20Jun-21Dec-21
NIM
Total NIMNIM excl. Liquid Assets
45.4%
48.8%
46.8%
43.8%
44.9%
45.9%
44.8%
43.1%
Jun-20Dec-20Jun-21Dec-21
CTI
Reported CTIUnderlying CTI
0.65%
0.19%
0.44%
0.31%
0.33%
Jun-20Dec-20Jun-21Dec-21
Impairment Expense Ratio
Reported Impairment Expense Ratio
Adjusted Impariment Expense Ratio
87.0
83.5
79.4
90.9
1.87%
1.77%
1.58%
1.70%
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
Jun-20Dec-20Jun 21Dec-21
70.0
80.0
90.0
100.0
110.0
Non Performing Loans
Non Performing LoansNon Performing Loans Ratio

1
Total fully imputed dividends for 1H2022 (interim) and 2H2021 (final) divided by the closing share price as at 14 February 2022 of $2.35.
2
Total fully imputed dividends for 1H2021 (interim) and 2H2020 (final) divided by the closing share price as at 9 February 2021 of $1.88.
•Return on equity (ROE) of 12.2%
(up7 bps vs1H2021).
•Earnings per share (EPS) of 8.1cps,
up0.5cps compared to1H2021.
•1H2022 interim dividend of 5.5 cps (1.5
cps up on 1H2021).
•Dividend yield of7.4%
1
compares with 4.8%
2
in 1H2021.
•Five year total shareholder return (TSR)of
128.9%, (17 February 2017 –17 February
2022) compared with the NZX50 Index
TSR of 80.7% in the same period.
11
Shareholder
return
10.5%
12.2%
11.9%
12.2%
Jun 20Dec 20Jun 21Dec 21
ROE
3.5
4.5
4.0
5.5
6.5
2.5
7.0
FY19FY20FY21FY22
Dividend per share (cps)
Interim DividendFinal Dividend
5.9
6.9
7.6
8.1
7.1
5.6
7.3
FY19FY20FY21FY22
Earnings per share (cps)
Interim EPSFinal EPS

13
Divisional
summary
12

13
2
Compounded annual growth rate for the period 1 January 2017 –31 December2021.
Reverse Mortgages portfolio analytics
$649
M
NZ ReverseMortgages
+$47m(15.6%)
3
vs June 2021
A$1,064
M
AU ReverseMortgages
+A$62m(12.3%)
2
vs June 2021
A$141,357Average loan size
77 Weighted average borrowers’ age
11.4%Average origination LVR
21.2%Weighted average LVR
Proportion of the loan
0.3%book over 75% LVR
Number of loans in the
8book over 75% LVR
A$111m
(+A$15m vs 1H2021)1H2022 origination
A$76mTotal repayments
(+A$6m vs 1H2021)in 1H2022
15.1%1H2022 annualised
(vs 15.2% in 1H2021)repayment rate
Compounded annual
18.6%growth rate
1
18.5%Repayments from vintage
(vs 30.5% in 1H2021)loans (+11 years)
NEW ZEALAND
1
Averageloansize$111,842
Weighted average borrowers’ age 78
AverageoriginationLVR10.0%
WeightedaverageLVR19.3%
Proportion oftheloan
book over75%LVR0.0%
Number ofloans in the
book over75%LVR1
$76m
1H2022 origination(+$31m vs 1H2021)
Total repayments$46m
in 1H2022(+$2m vs 1H2021)
1H2022 annualised15.2%
repayment rate(vs 15.8% in 1H2021)
Compounded annual
growth rate
2
11.0%
Repayments from vintage36.0%
loans (+11 years)(vs 34.6% in 1H2021)
3
Annualised growth.
AUSTRALIA
1
1
Balances are as at 31 December 2021. All other metrics are for 1H2022.

14
1
Excluding the impact of changes in FX rates.
As at 31 December 2021
As at 31 December 2021
•Receivables increased by $65.4 million
(12.1%)
1
to $1.14 billion.
•New business was strong, driving higher than
expected new lending, due to a buoyant
property market, and repayments below long-
term averages in December.
•Direct new business increased by 18%
compared with 1H2021. The intermediary
channel experienced 8% growth in new
business during the same period.
•Intermediaries contribute 51% to new
origination.
•Express Reverse Mortgages pilot launched in
January 2022, offering a streamlined loan with
a market-leading variable rate, for over 60 year
olds.
AU Reverse
Mortgages
+4.7%
increase since 1H2021
+12.1%
1
annualised growthsince June2021
$19.0m
NET OPERATINGINCOME
$1.14b
RECEIVABLES

15
$648.9m
+15.6%
As at 31 December 2021
As at 31 December 2021
NZ Reverse
Mortgages
+36.6%
increase since 1H2021
annualised growthsince June2021
$15.3m
NET OPERATINGINCOME
RECEIVABLES
•New Zealand Reverse Mortgages NOI was up
36.6% from 1H2021 due to record asset growth
and improved margins.
•Receivables increased $47.4 million (15.6%) to
$648.9 million due to strong new business
performance.
•Enquiry levels up 65% in the 2021 calendar year.
•Performance driven by increased awareness and
acceptance of reverse mortgages, supported by
favourablemarket conditions with higher house
prices and low interest rates.

16
1
Excludingthe impact of changes in FXrates.
-9.3%
1
As at 31 December 2021
As at 31 December 2021
Open for
Business
-4.2%
decrease since 1H2021
annualised decrease since June2021
$7.2m
NET OPERATINGINCOME
$137.7m
RECEIVABLES
•1H2022 saw a decrease of $0.3 million (4.2%)
in NOIas a result of subdued confidence
resulting from COVID-19-related lockdowns
and travel restrictions.
•Receivables decreased $6.8 million (9.3%)
1
to
$137.7 million.
•The availability of NZ Government COVID-19
support packages for small businesses slowed
growth in this segment from 2H2020 and
continues to feature.

As at 31 December 2021
As at 31 December 2021
Asset
Finance
1
+17.9%
increasesince1H2021
+12.4%
annualised growth since June2021
$15.8m
NET OPERATINGINCOME
17
$606.6m
RECEIVABLES
•Asset Finance NOI was up 17.9% from 1H2021.
•Receivables increased $35.7 million (12.4%) to
$606.6 million.
•The underlying demand from transport,
logistics and other productive sectors has
remained consistent.
1
Previously referred to as Business Intermediated.

As at 31 December 2021
As at 31 December 2021
Wholesale
Lending
1
+28.8%
increasesince1H2021
+13.7%
1
annualised growth since June2021
$15.7m
NET OPERATINGINCOME
18
1
Wholesale Lending includes what was formally known as Business Relationship, reflecting Heartland’s strategy in this space.
2
Excludingthe impact of changes in FXrates.
$593.4m
RECEIVABLES
•Receivables increased $38.4 million (13.7%)
2
to
$593.4 million.
•Go Car Finance contributed to growth with
continued funding for its New Zealand loan
book.
•Expansion of wholesale motor vehicle dealer
groups, allowing wholesale dealers to manage
finance via a digital interface, aligned with
Heartland’s strategy to diversify distribution in
motor vehicle finance.

19
$1.35b
+8.8%
As at 31 December 2021
As at 31 December 2021
Motor
Finance
+10.4%
increasesince1H2021
annualised growth since June2021
$36.4m
NET OPERATINGINCOME
RECEIVABLES
•Organic growth from Heartland’s existing
dealer network, increase in intermediaries and
key partnerships through Heartland’s 'white
label' strategy.
•Franchises contributed 48% of business as new
car sales recovered in 2021 after record lows in
2020.
•CCCFA changes slowed growth in Motor in
January and February 2022 and are expected
to impact on growth rate.
•Continued to provide finance for electric
and hybrid vehicles through ‘white label’
partners who have committed to increasing
the number of electric and hybrid vehicle
options available.

As at 31 December 2021
As at 31 December 2021
-38.8%
decrease since 1H2021
-68.5%
1
annualiseddecrease since June2021
$5.4m
NET OPERATINGINCOME
$86.5m
RECEIVABLES
20
1
Excludingthe impact of changes in FXrates.
•The New Zealand Harmoney portfolio
contracted $38.0 million (98.1%) to
$38.8 million.
•The Australian Harmoneyportfolio
decreased by $18.1 million (73.7%)
1
to
$30.7 million.
•Both New Zealand and Australian portfolios
continued to contract in 1H2022 as a result of
high repayments combined with limited
growth.
Personal
Lending

As at 31 December 2021
As at 31 December 2021
Rural
flat
increase since 1H2021
-0.9%
annualiseddecrease since June2021
$15.5m
NET OPERATINGINCOME
$584.1m
RECEIVABLES
21
•A decrease in LivestockReceivables of $12.9
million (23.5%) to $96.4 million, partly offset by
a $10.4 million (4.3%) increase in Rural
Receivables to $487.7 million.
•Average Livestock receivables position up 7.1%
year on year.
•Growth in approved limits and receivables
continued through January and February,
supporting Heartland’s positive outlook for
Livestock.
•Results from Sheep & Beef Direct have been
positive, with $54.8 million of growth in
1H2022.
•Plans underway for Dairy Direct, a similar
digital platform, responding to growing need
for dairy farmers to have access to online
finance.

HomeLoans¹
•Home Loans
1
Receivables increased $163.2
million in 1H2022 to $213.1 million.
•Lending growth supported by Heartland’s
low interest rates, currently market-leading
for 2-and 3-year fixed rates, and standard
floating rate.
•CCCFA changes have added to the traditional
summer slowdown. However, with the
ministerial review underway, changes made
to the application process, and a renewed
marketing campaign, positive momentum is
expected to resume.
•More than 7,840 applications received
during 1H2022, an increase of 29.2% on
6,067 applications received during 2H2021.
•New intermediary partnership being piloted
with NZ Financial Services Group under
‘Engage Home Loans’ white label brand.
22
1
Excludes legacy Retail Mortgages.
1
As at 31 December 2021
As at 31 December 2021
649.2%
annualisedincrease since June2021
$0.6m
NET OPERATINGINCOME
$213.1m
RECEIVABLES

23
Funding and
liquidity
Heartland increased borrowings by $290.8 million (6.0%), contributed to by increases in both New Zealand and
Australia.
NewZealand
•Heartland Bank increased borrowings by $236.4 million (6.4%).
•Deposits grew $117.0 million (3.6%).
•Launched 32-Day Notice Saver product at market-leading rate.
•Decreased total liquidity by $36.3 million (7.7%) reflecting a return to more normalisedlevels.
•Heartland Bank holds liquidity well in excess of regulatory minimums.
•Increased committed auto warehouse facility from $300 million to $400 million in September 2021, with the
amount drawn down increasing by $126.6 million.
Australia
•Heartland Australia increased borrowings by A$32.9 million (3.0%) in 1H2022 and has access to committed
Australian reverse mortgage loan funding of A$1.25 billion in aggregate.
•The Heartland Australia group continues to successfully progress expansion and extension of its funding
facilities to cater for strong growth in its portfolios. An additional A$45 million MTN was issued in July 2021.
1
Includes intercompany deposits.
3,269
3,271
3,220
3,337
909
984
1,178
1,200
359
390
503
622
Jun 20Dec 20Jun 21Dec 21
Funding Composition $m
DepositsAU wholesale fundingNZ wholesale funding
1
389
458
312
294
397
449
357
296
147
153
182
208
Jun 20Dec 20Jun 21Dec 21
Liquidity Composition $m
Undrawn limitInvestmentsCash
1

•Partial restriction on bank dividends remains in place (currently until 1 July 2022).
•Heartland Bank’s capital ratio as at 31 December 2021 is 13.98% (up from 13.88% in 30 June 2021).
•As part of the RBNZ capital implementation review requiring an increase in capital, increases in capital will be phased in
over a seven-year period, starting from 1 July 2022, requiring minimum total capital ratio to gradually be increased from
the current 10.5% to 16.0%.
•Heartland Bank’s current capital position and organic growth in capital is expected to be sufficient to meet future
minimum requirements.
24
Capital
$778.2 million (13.0% of total assets)
683 49 46
Heartland Capital Allocation$m
Heartland BankHeartland AustraliaHeartland Group Holdings

25
Strategic
update
1

Regulatory
update
Heartland continues to monitor the significant
volume of regulatory change.
•Changes to the CCCFA came into force on 1
December.Heartland has implemented
new processes and technologies to enable
it to comply with the changes and
continues to refine these.
•Deposit Takers Act is being developed to
strengthen the regulatory framework for all
institutions that take deposits and
introduce a new deposit insurance
scheme.
27
26

26
Strategicobjectives
Heartland’s strategic visionto provide best or only products viascalabledigital
platformswill be achievedthrough:
1.Business as usualgrowth
Broadening product offerings and
achieving growth across business
as usual activity, including through
product and platform
developments.
2.Frictionless service atthe
lowestcost
Frictionless service at each stage of
a customer’s journey to provide
improved reach and customer
experience across integrated
platforms.
Online access eases inconvenience
and removes costly operational
processes–enhancing customer
experience and allowing savings to
be passedonto customers.
As described by the virtuouscircle
to the right.
3.Expansion inAustralia
Expanding product offeringsto
meet the wider needs of the
demographic entering, as well
as in,retirement.
Exploring expansion into other
asset classesthroughdigital
platforms andexisting
relationships with
intermediariesthat lend to
businesses and consumers.
4.Acquisitions
Where there is a fit with the
above and the opportunity to
add value, acquisitions will be
explored.
Reduce CTIratio
Provide best or only
productsthroughscalable
digital platforms, at the
lowestcost
Offer best value for
customers (through
price, speedorcustomer
experience)
Increasecustomer
volumes
Increaseincome
earned
Reduce CTI ratio
27

Looking
forward
•1H2022 NPAT exceeded expectations, despite a
challenging backdrop of continued COVID-19
impacts and legislative disruption.
•Strong asset growth has been achieved, though
2H2022 growth is expected to slow in Motor and
online Home Loans as a result of CCCFA impact.
•Continued shift in portfolio mix toward higher
quality and lower risk assets is expected to
impact NIM in 2H2022, however will be
mitigated as operational efficiency and asset
quality continue to improve.
•Increased digitalisation and automation have
continued to increase Heartland’s ability to pass
cost-savings to customers, leading to the CTI
ratio trending downwards.
•Heartland expects NPAT for FY2022to be in the range
of $93 millionto $96 million.
NPAT FORFY2022
28

Appendices
29

Appendix 1
Financial
position
30
$m
31 December
2021
30 June
2021
Movement
($m)
Movement
(%)
Liquid Assets503539(36)(6.7%)
Gross Finance
Receivables
5,3585,0183396.8%
Provisions(53)(54)00.8%
Other Assets191179126.7%
TOTAL ASSETS5,9995,6833165.6%
Retail Deposits3,3323,1831494.7%
Other Borrowings1,8221,6811428.4%
Total Funding5,1554,8642916.0%
Other Liabilities6657914.9%
Equity778762162.2%
TOTAL EQUITY &
LIABILITIES
5,9995,6833165.6%

Net Interest Margin
4.30%4.28%3 bps
Cost to Income ratio
43.8%48.8%(5.0 pps)
Return on Equity
12.2%12.2%7 bps
Earnings per Share
8.1 cps7.6 cps
0.5cps
Appendix 2
Financial
performance
31
Includes fair value movements.
1
$m 1H20221H2021Change ($)Change (%)
Net Operating Income
1
130.7125.35.44.3%
Operating Expenses57.361.1(3.8)(6.3%)
Impairment Expense8.54.54.088.1%
Profit Before Tax64.959.65.38.8%
Tax Expense17.415.51.811.8%
Net Profit After Tax47.544.13.47.8%

Appendix 3
Reconciliationof
reportedwith
underlying results
1H2022 one-offs included in the reportedresult:
•Fair value gain on equity investment in Harmoney Corp
Limited (Harmoney): a $0.2 million gain was recognised
from the fair value uplift on the shares acquired during the
period.
•Fair value loss on other investments: a $0.3 million fair
value loss was recognisedon Heartland Bank’s rights over
a profit-sharing arrangement with a customer.
•Prior period tax adjustments: a $1.2 million release of tax
provisions relating to prior periods.
•Other non-recurring expenses: $0.9 million.
1H2021one-offs included in the reportedresult:
•Fair value gain on investment: $5.2 million fair value
gain was recognisedon Heartland’s equity investment in
Harmoney
•Voluntarily accelerated amortisationof intangible assets:
$4.3 million expense was recognised, reflecting an
acceleration of amortisationof software assets held on
the balance sheet.
•Aged items provision and write-off: $1.7 million of aged
legacy suspense account transactions were written off or
provisioned where collectability is uncertain.
•Other non-recurring expenses: $0.1 million.
32
$m1H20221H2021Movement ($m)Movement (%)
Reported NOI130.7125.35.44.3%
Less:
Net fair value gain on investments(0.1)5.2(5.3)
Underlying NOI130.8120.110.78.9%
Reported OPEX57.361.1(3.8)(6.3%)
Less:
Voluntarily accelerated amortisation-4.3(4.3)
Aged items provision and write-off-1.7(1.7)
Other non-recurring items0.90.10.8
Underlying OPEX56.455.11.42.5%
Reported impairment expense8.54.54.088.1%
Reported NPAT47.544.13.47.8%
Less:
Post-tax impact of one-offs(0.7)0.8(1.6)
Tax adjustments relating to prior periods1.21.2
Underlying NPAT47.143.33.88.8%
Reported Average Equity769.9718.551.4
Underlying Average Equity770.1720.649.66.9%
Reported CTI43.8%48.8%(5.0%)
Underlying CTI43.1%45.8%(2.7%)
Reported ROE12.2%12.2%0.07%
Underlying ROE12.1%11.9%0.21%

Thank you
For Heartland’s 1H2022 half year
results announcement, please see
shareholders.heartland.co.nz

---

Results announcement
(for Equity Security issuer/Equity and Debt Security issuer)

Results for announcement to the market
Name of issuer Heartland Group Holdings Limited
Reporting Period 6 months to 31 December 2021
Previous Reporting Period 6 months to 31 December 2020
Currency NZD
Amount (000s) Percentage change
Revenue from continuing
operations
$130,712 4.3%
Total Revenue $130,712 4.3%
Net profit/(loss) from
continuing operations
$47,516 7.8%
Total net profit/(loss) $47,516 7.8%
Interim/Final Dividend
Amount per Quoted Equity
Security
$0.05500000
Imputed amount per Quoted
Equity Security
$0.02138889
Record Date 02/03/2022
Dividend Payment Date 16/03/2022
Current period Prior comparable period
Net tangible assets per
Quoted Equity Security
$1.17 $1.12
A brief explanation of any of
the figures above necessary
to enable the figures to be
understood

Authority for this announcement
Name of person

authorised
to make this announcement
Andrew Dixson, Chief Financial Officer
Contact person for this
announcement
Andrew Dixson, Chief Financial Officer
Contact phone number 09 927 9274
Contact email address Andrew.Dixson@heartland.co.nz
Date of release through MAP

22/02/2022

Unaudited financial statements accompany this announcement.

---

Distribution Notice




Please note: all cash amounts in this form should be provided to 8 decimal places

Section 1: Issuer information
Name of issuer Heartland Group Holdings Limited
Financial product name/description Ordinary shares
NZX ticker code HGH
ISIN (If unknown, check on NZX
website)
NZHGHE0007S9
Type of distribution
(Please mark with an X in the
relevant box/es)
Full Year Quarterly
Half Year X Special
DRP applies X
Record date 2 March 2022
Ex-Date (one business day before the
Record Date)
1 March 2022
Payment date (and allotment date for
DRP)
16 March 2022
Total monies associated with the
distribution
1

$32,440,896.11
Source of distribution (for example,
retained earnings)
Retained earnings
Currency NZD
Section 2: Distribution amounts per financial product
Gross distribution
2
$0.07638889
Gross taxable amount
3
$0.07638889
Total cash distribution
4
$0.05500000
Excluded amount (applicable to listed
PIEs)
NIL
Supplementary distribution amount $0.00970588
Section 3: Imputation credits and Resident Withholding Tax
5

Is the distribution imputed

Fully imputed - YES
Partial imputation
No imputation

1
Continuous issuers should indicate that this is based on the number of units on issue at the date of the form
2
“Gross distribution” is the total cash distribution plus the amount of imputation credits, per financial product, before the deduction of
Resident Withholding Tax (RWT).
3
“Gross taxable amount” is the gross distribution minus any excluded income.
4
“Total cash distribution” is the cash distribution excluding imputation credits, per financial product, before the deduction of RWT.
This should include any excluded amounts, where applicable to listed PIEs.
5
The imputation credits plus the RWT amount is 33% of the gross taxable amount for the purposes of this form. If the distribution is
fully imputed the imputation credits will be 28% of the gross taxable amount with remaining 5% being RWT. This does not constitute
advice as to whether or not RWT needs to be withheld.

If fully or partially imputed, please
state imputation rate as % applied
6

28%
Imputation tax credits per financial
product
$0.02138889
Resident Withholding Tax per
financial product
$0.00381941
Section 4: Distribution re-investment plan (if applicable)
DRP % discount (if any)
2.0%
Start date and end date for
determining market price for DRP
03/03/2022 09/03/2022
Date strike price to be announced (if
not available at this time)
Before 10am on 10/03/2022
Specify source of financial products to
be issued under DRP programme
(new issue or to be bought on market)
New issue
DRP strike price per financial product
$
Last date to submit a participation
notice for this distribution in
accordance with DRP participation
terms
03/03/2022, 5:00pm (NZT)
Section 5: Authority for this announcement
Name of person

authorised to make
this announcement
Andrew Dixson, Chief Financial Officer
Contact person for this
announcement
Andrew Dixson, Chief Financial Officer
Contact phone number 09 927 9274
Contact email address Andrew.Dixson@heartland.co.nz
Date of release through MAP

22/02/2022





6
Calculated as (imputation credits/gross taxable amount) x 100. Fully imputed dividends will be 28% as a % rate applied.

---

Interim

Financial

Statements
For the six months

ended 31 December 2021

P.2
Contents
Page
General Information..........................................................................................................................................................................3
Directors............................................................................................................................................................................................. 3
Auditor............................................................................................................................................................................................... 3
Directors’ Statements....................................................................................................................................................................... 4
Consolidated Interim Statement of Comprehensive Income......................................................................................................5
Consolidated Interim Statement of Changes in Equity................................................................................................................ 6
Consolidated Interim Statement of Financial Position.................................................................................................................8
Consolidated Interim Statement of Cash Flows.............................................................................................................................9
Notes to the Interim Financial Statements
1 Interim financial statements preparation.......................................................................................................................11
Performance
2 Segmental analysis.............................................................................................................................................................13
3 Net interest income............................................................................................................................................................15
4 Operating expenses...........................................................................................................................................................15
5 Compensation of auditor..................................................................................................................................................15
6 Impaired asset expense.................................................................................................................................................... 16
7 Earnings per share............................................................................................................................................................ 16
Financial Position
8 Finance receivables............................................................................................................................................................17
9 Borrowings..........................................................................................................................................................................21
10 Share capital and dividends..............................................................................................................................................23
11 Related party transactions and balances........................................................................................................................23
12 Fair value.............................................................................................................................................................................25
Risk Management
13 Enterprise risk management............................................................................................................................................ 30
14 Credit risk exposure...........................................................................................................................................................30
15 Liquidity risk........................................................................................................................................................................32
16 Interest rate risk.................................................................................................................................................................34
Other Disclosures
17 Structured Entities............................................................................................................................................................ 36
18 Insurance business, securitisation, funds management, other fiduciary activities..................................................37
19 Contingent liabilities and commitments.........................................................................................................................37
20 Events after reporting date...............................................................................................................................................38

P.3
General Information
Heartland Group Holdings Limited (HGH) is incorporated in New Zealand and registered under the Companies Act 1993. The
shares in HGH are listed on the New Zealand's Exchange (NZX) main board and the Australian Securities Exchange (ASX) under a
foreign exempt listing.
HGH's address for service is Level 3, 35 Teed Street, Newmarket, Auckland 1023.
Directors
All Directors of HGH reside in New Zealand with the exception of Ellen Frances Comerford and Geoffrey Edward Summerhayes
who reside in Australia. Communications to the Directors can be sent to Heartland Group Holdings Limited, Level 3, 35 Teed
Street, Newmarket, Auckland 1023.
On 1 October 2021, Kathryn Mitchell and Geoffrey Edward Summerhayes were appointed as Directors and have been re-elected
on 28 October 2021. Christopher Robert Mace retired as a Director on 28 October 2021.
There have been no other changes in the composition of the Board of Directors of HGH since 30 June 2021 to the six months
ended 31 December 2021.
Auditor
KPMG
KPMG Centre
18 Viaduct Harbour Avenue
Auckland 1010

P.4
Directors’ Statements
The consolidated interim financial statements for HGH and its subsidiaries (together the Group) are dated 21 February 2021 and
have been signed by all the Directors.
G T Ricketts (Chair) E F Comerford
J K Greenslade K Mitchell
G E Summerhayes G R Tomlinson

P.5
Consolidated Interim Statement of Comprehensive Income
For the six months ended 31 December 2021
Unaudited
6 Months to
December 2021
Unaudited
6 Months to
December 2020
Audited
12 Months to
June 2021
$000's Note
Interest income
3
163,586 166,387 327,935
Interest expense
3
39,683 53,174 94,418
Net interest income 123,903 113,213 233,517
Operating lease income 2,588 2,579 5,004
Operating lease expense 1,545 1,598 3,149
Net operating lease income 1,043 981 1,855
Lending and credit fee income 4,565 4,041 8,090
Other income 1,295 1,880 3,634
Net operating income 130,806 120,115 247,096
Operating expenses
4
57,292 61,130 117,658
Profit before impaired asset expense and income tax 73,514 58,985 129,438
Fair value (loss)/gain on investments (93)5,1774,092
Impaired asset expense
6
8,535 4,53814,974
Profit before income tax 64,886 59,624 118,556
Income tax expense 17,370 15,534 31,530
Profit for the period 47,516 44,090 87,026
Other comprehensive income
Items that are or may be reclassified subsequently to profit or
loss, net of income tax:
Effective portion of change in fair value of derivative financial
instruments
6,739 4,580 8,940
Movement in fair value reserve (6,356) (1,038) (5,646)
Movement in foreign currency translation reserve (25)(121)(68)
Other comprehensive income for the period, net of income tax 358 3,421 3,226
Total comprehensive income for the period 47,874 47,511 90,252
Earnings per share
Basic earnings per share 7 8.08c 7.57c 14.92c
Diluted earnings per share 7 8.08c 7.57c 14.92c
Total comprehensive income for the period is attributable to the owners of the Group.
The notes to the interim financial statements form an integral part of, and should be read in conjunction with, these
consolidated interim financial statements.

P.6
Consolidated Interim Statement of Changes in Equity
For the six months ended 31 December 2021
Share
Capital
Employee
Benefit
Reserve
Foreign
Currency
Translation
Reserve
Fair
Value
Reserve
Defined
Benefit
Reserve
Cash
Flow
Hedge
Reserve
Retained
Earnings
Total
Equity $000's Note
Unaudited - December 2021
Balance as at 1 July 2021 583,781 2,731 (3,975) (322)171918 178,388 761,692
Total comprehensive
income for the period
Profit for the period - - - - -- 47,51647,516
Other comprehensive (loss)/gain,
net of income tax
- - (25) (6,356) -6,739-358
Total comprehensive (loss)/
income for the period
- - (25) (6,356) -6,73947,516 47,874
Contributions by and distributions
to owners
Dividends paid 10 - - - - --(41,013) (41,013)
Dividend reinvestment plan 8,926 - - - - - - 8,926
Share based payments -698- - - - -698
Total transactions with owners 8,926 698 - - - - (41,013) (31,389)
Balance as at 31 December 2021 592,707 3,429 (4,000) (6,678) 171 7,657 184,891 778,177
Unaudited - December 2020
Balance as at 1 July 2020 576,257 934 (3,907) 5,324 171 (8,022) 129,223 699,980
Total comprehensive
income for the period
Profit for the period - - - - -- 44,09044,090
Other comprehensive (loss)/gain,
net of income tax
- - (121) (1,038) -4,580-3,421
Total comprehensive (loss)/
income for the period
- - (121) (1,038) -4,58044,090 47,511
Contributions by and distributions
to owners
Dividends paid 10 - - - - --(14,524) (14,524)
Dividend reinvestment plan 10 3,046 - - - - - - 3,046
Share based payments -1,057- - - - -1,057
Total transactions with owners 3,046 1,057 - - - - (14,524) (10,421)
Balance as at 31 December 2020 579,303 1,991 (4,028) 4,286 171 (3,442) 158,789 737,070
The notes to the interim financial statements form an integral part of, and should be read in conjunction with, these
consolidated interim financial statements.

P.7
Consolidated Interim Statement of Changes in Equity (Continued)
For the six months ended 31 December 2021
Share
Capital
Employee
Benefit
Reserve
Foreign
Currency
Translation
Reserve
Fair
Value
Reserve
Defined
Benefit
Reserve
Cash
Flow
Hedge
Reserve
Retained
Earnings
Total
Equity $000's Note
Audited - June 2021
Balance as at 1 July 2020 576,257 934 (3,907) 5,324 171 (8,022) 129,223 699,980
Total comprehensive
income for the year
Profit for the year - - - - -- 87,02687,026
Other comprehensive (loss)/gain,
net of income tax
- - (68) (5,646) -8,940-3,226
Total comprehensive (loss)/
income for the year
- - (68) (5,646) -8,94087,026 90,252
Contributions by and distributions
to owners
Dividends paid 10 - - - - --(37,861) (37,861)
Dividend reinvestment plan 10 7,524 - - - - - - 7,524
Share based payments -1,797- - - - -1,797
Total transactions with owners 7,524 1,797 - - - - (37,861) (28,540)
Balance as at 30 June 2021 583,781 2,731 (3,975) (322)171918 178,388 761,692
The notes to the interim financial statements form an integral part of, and should be read in conjunction with, these
consolidated interim financial statements.

P.8
Consolidated Interim Statement of Financial Position
As at 31 December 2021
Unaudited
December 2021
Unaudited
December 2020
Audited
June 2021
$000's
Note
Assets
Cash and cash equivalents 207,666 152,818 182,333
Investments 318,273 470,368 377,823
Investment properties 11,832 11,132 11,832
Derivative financial instruments 21,714 15,023 14,139
Finance receivables 8 3,526,234 3,042,588 3,288,466
Finance receivables - reverse mortgages 8 1,778,066 1,607,352 1,676,073
Operating lease vehicles 13,009 12,712 10,865
Right of use assets 14,843 17,202 15,985
Other assets 16,444 22,397 16,815
Intangible assets 74,531 68,874 69,165
Deferred tax asset 16,288 17,521 14,117
Total assets 5,998,900 5,437,987 5,677,613
Liabilities
Retail deposits 9 3,332,409 3,268,554 3,183,454
Other borrowings 9 1,822,465 1,373,962 1,675,133
Lease liabilities 16,980 19,363 18,166
Tax liabilities 5,619 4,238 7,440
Derivative financial instruments 3,548 12,805 4,802
Trade and other payables 39,702 21,995 26,926
Total liabilities 5,220,723 4,700,917 4,915,921
Equity
Share capital 10 592,707 579,303 583,781
Retained earnings and other reserves 185,470 157,767 177,911
Total equity 778,177 737,070 761,692
Total equity and liabilities 5,998,900 5,437,987 5,677,613
Total interest earning and discount bearing assets 5,735,324 5,238,005 5,432,181
Total interest and discount bearing liabilities 5,138,333 4,623,224 4,840,310
The notes to the interim financial statements form an integral part of, and should be read in conjunction with, these
consolidated interim financial statements.

P.9
Consolidated Interim Statement of Cash Flows
For the six months ended 31 December 2021
Unaudited
6 Months to
December 2021
Unaudited
6 Months to
December 2020
Audited
12 Months to
June 2021
$000's
Note
Cash flows from operating activities
Interest received 116,664 122,922 233,447
Operating lease income received 1,807 1,480 5,046
Lending, credit fees and other income received 2,920 4,719 4,625
Operating inflows 121,391 129,121 243,118
Interest paid (51,000) (42,973) (85,058)
Payments to suppliers and employees (38,641) (53,258) (97,205)
Taxation paid (20,988) (25,061) (34,004)
Operating outflows (110,629) (121,292) (216,267)
Net cash flows from operating activities before changes in
operating assets and liabilities
10,762 7,829 26,851
Proceeds from sale of operating lease vehicles 3,023 5,584 6,821
Purchase of operating lease vehicles (6,016) (1,594) (1,788)
Net movement in finance receivables (299,163) (24,714) (296,754)
Net movement in deposits 149,107 7,563 (74,608)
Net cash flows (applied to) operating activities
1
(142,287) (5,332) (339,478)
Cash flows from investing activities
Purchase of property, plant and equipment and intangible assets (8,578) (4,322) (7,562)
Net decrease/(increase) in investments 53,101 (62,877) 23,276
Total cash from/(applied to) investing activities 44,523 (67,199) 15,714
Net cash flows from/(applied to) investing activities 44,523 (67,199) 15,714
Cash flows from financing activities
Net increase in wholesale funding 111,117 91,038 309,680
Proceeds from issue of unsubordinated notes 45,265 -81,801
Total cash provided from financing activities 156,382 91,038 391,481
Dividends paid 10 (32,087) (11,478) (30,337)
Payment of lease liabilities (1,198) (1,390) (2,226)
Total cash applied to financing activities (33,285) (12,868) (32,563)
Net cash flows from financing activities 123,097 78,170 358,918
Net increase in cash held 25,333 5,639 35,154
Opening cash and cash equivalents 182,333 147,179 147,179
Closing cash and cash equivalents 207,666 152,818 182,333
1
Cash flows from operating activities do not include cash flows from wholesale funding which are included as part of financing activities.
The notes to the interim financial statements form an integral part of, and should be read in conjunction with, these
consolidated interim financial statements.

P.10
Consolidated Interim Statement of Cash Flows (Continued)
For the six months ended 31 December 2021
Reconciliation of profit after tax to net cash flows from operating activities
Unaudited
6 Months to
December 2021
Unaudited
6 Months to
December 2020
Audited
12 Months to
June 2021
$000's
Note
Profit for the period 47,516 44,090 87,026
Add/(less) non-cash items:
Depreciation and amortisation expense 5,624 9,463 14,615
Depreciation on lease vehicles 1,429 1,436 2,801
Capitalised net interest income and fee income (53,178) (32,640) (68,755)
Impaired asset expense 6 8,535 4,538 14,974
Investment fair value movement 93 (5,177) (4,092)
Other non-cash items (6,662) (7,335) (24,538)
Total non-cash items (44,159) (29,715) (64,995)
Add/(less) movements in operating assets and liabilities:
Finance receivables (299,163) (24,714) (296,754)
Operating lease vehicles (2,993) 3,990 5,033
Other assets (191)1,8753,448
Current tax (1,821) (8,065) (4,863)
Derivative financial instruments (2,090) 2,596 (163)
Deferred tax (2,171) (398)3,006
Deposits 149,107 7,563 (74,608)
Other liabilities 13,678 (2,554) 3,392
Total movements in operating assets and liabilities (145,644) (19,707) (361,509)
Net cash flows applied to operating activities
1
(142,287) (5,332) (339,478)
1
Cash flows from operating activities do not include cash flows from wholesale funding which are included as part of financing activities.
The notes to the interim financial statements form an integral part of, and should be read in conjunction with, these
consolidated interim financial statements.

P.11
Notes to the Interim Financial Statements
For the six months ended 31 December 2021
1 Interim financial statements preparation
Basis of preparation
The interim financial statements presented are the consolidated interim financial statements comprising Heartland Group
Holdings Limited (HGH) and its subsidiaries (the Group). They have been prepared in accordance with Generally Accepted
Accounting Practices in New Zealand (NZ GAAP) as defined in the Financial Reporting Act 2013. These consolidated interim
financial statements comply with NZ IAS 34 Interim Financial Reporting as appropriate for publicly accountable for-profit entities
and NZ IAS 34 Interim Financial Reporting.
The consolidated interim financial statements do not include all notes of the type normally included in an annual financial report.
Accordingly this report is to be read in conjunction with the consolidated financial statements for the year ended 30 June 2021
and any public announcements made by the Group during the interim reporting period.
The consolidated interim financial statements presented here are for the following periods:
•6 month period ended 31 December 2021 – Unaudited
•6 month period ended 31 December 2020 – Unaudited
•12 month period ended 30 June 2021 – Audited
The consolidated interim financial statements have been prepared on a going concern and historical cost basis, unless stated
otherwise. The accounting policies adopted are consistent with those of the previous financial year and corresponding interim
reporting period.
Certain comparative balances have been reclassified to align with the presentation used in the current financial year. These
reclassifications have no impact on the overall financial performance or financial position for the comparative year.
Change in accounting policy
There have been no changes to accounting policies or new or amended standards that are issued and effective that are expected
to have a material impact on the Group.
Accounting standards issued not yet effective
The final version of NZ IFRS 17 Insurance Contracts was issued in August 2017 and is applicable to general and life insurance
contracts. The standard will be effective for the Group’s reporting for the financial year ending 30 June 2024, including 30 June
2023 comparatives.
MARAC Insurance Limited (MIL), a subsidiary of Heartland Bank Limited (HBL), ceased writing insurance policies in 2020 with the
periodic policies expected to expire in 2025.
Other amendments to existing standards that are not yet effective are not expected to have a material impact on the Group.

P.12
1 Interim financial statements preparation (continued)
Estimates and judgements
There have been no material changes to the use of estimates and judgements for the preparation of the interim financial
statements since the reporting date of the previous financial statements. The Group’s financial statements for the year ended 30
June 2021 contain detail on the estimates and judgements used.
Covid-19 pandemic - impact on estimates and judgements
The COVID-19 pandemic resulted in the Group adopting an economic overlay for expected credit losses (ECL) to its portfolios as at
30 June 2020 of pre-tax $9.6 million in response to the uncertain but potential economic impact of COVID-19 on HGH's borrowers
(COVID Overlay). The COVID Overlay was sized based on a range of techniques including stress testing, benchmarking, scenario
analysis and expert judgement.
To date, the impact of COVID-19 on HGH's borrowers has been more benign than was initially forecast, and the COVID Overlay has
not been utilised. However, the continued prevalence of COVID-19 in other countries (including the emergence of new variants),
together with vaccination rates and border closures provide an ongoing risk of further economic disruption in New Zealand. This
may impact borrowers with the potential for further inflationary pressures, increased interest rates and expected higher
employment costs resulting from a restricted supply of labour.
With the uncertainties associated to the ongoing economic impacts of COVID-19, the COVID Overlay has been retained in full at
this stage.
The accounting judgement that is most impacted by the COVID Overlay is the ECL on finance receivables at amortised cost. The
Group measures the allowance for ECL using an impairment model in compliance with NZ IFRS 9 Financial Instruments.

P.13
Performance
2 Segmental analysis
Segment information is presented in respect of the Group's operating segments which are those used for the Group's
management and internal reporting structure.
Operating segments
The Group operates within New Zealand and Australia and comprises the following main operating segments:
Motor Motor vehicle finance.
Reverse mortgages Reverse mortgage lending in New Zealand.
Personal lending Transactional, home loans and personal loans to individuals.
Business Term debt, plant and equipment finance, commercial mortgage lending and working capital solutions for
small-to-medium sized businesses.
Rural Specialist financial services to the farming sector primarily offering livestock finance, rural mortgage
lending, seasonal and working capital financing, as well as leasing solutions to farmers.
Australia Reverse mortgage lending and other financial services within Australia.
Certain operating expenses, such as premises, IT, support centre costs and tax expense are not allocated to operating segments
and are included in Other. Finance receivables are allocated across the operating segments as assets and liabilities are managed
centrally and therefore are not allocated across the operating segments.
The Group's operating segments are different from the industry categories detailed in Note 14 Credit risk exposure. The operating
segments are primarily categorised by sales channel, whereas Note 14 Credit risk exposure categorises exposures based on credit
risk concentrations.
Reverse Personal
$000's
Motor Mortgages Lending Business Rural Australia Other Total
Unaudited - December 2021
Net interest income 34,687 14,000 4,529 35,888 15,138 19,881 (221)123,903
Net other income 1,703 1,289 726 1,408 365 1,143 270 6,903
Net operating income 36,390 15,289 5,255 37,296 15,503 21,024 49 130,806
Operating expenses 1,975 2,354 3,268 4,756 1,531 5,507 37,899 57,292
Profit/(loss) before impaired asset
expense and income tax
34,415 12,935 1,987 32,540 13,972 15,517 (37,850) 73,514
Fair value (loss) on investment - - - - - - (93) (93)
Impaired asset expense/(benefit) 2,518 -9024,210 909 (5)18,535
Profit/(loss) before income tax 31,897 12,935 1,085 28,330 13,063 15,522 (37,944) 64,886
Income tax expense - - - - - - 17,370 17,370
Profit/(loss) for the period 31,897 12,935 1,085 28,330 13,063 15,522 (55,314) 47,516
Total assets 1,344,866 648,865 272,803 1,294,601 583,026 1,185,598 669,142 5,998,900
Total liabilities 5,220,723

P.14
2 Segmental analysis (continued)
Reverse Personal
$000's
Motor Mortgages Lending Business Rural Australia Other Total
Unaudited - December 2020
Net interest income
31,255 10,175 7,633 31,659 15,071 17,669 (249)113,213
Net other income
1,717 1,018 1,137 1,343 460 524 703 6,902
Net operating income 32,972 11,193 8,770 33,002 15,531 18,193 454 120,115
Operating expenses
1,843 1,986 3,151 5,896 1,172 6,838 40,244 61,130
Profit/(loss) before impaired asset
expense and income tax
31,129 9,207 5,619 27,106 14,359 11,355 (39,790) 58,985
Fair value gain on investments
- - - - - - 5,177 5,177
Impaired asset expense/(benefit)
2,266 -(793)2,674 391 - - 4,538
Profit/(loss) before income tax
28,863 9,207 6,412 24,432 13,968 11,355 (34,613) 59,624
Income tax expense
- - - - - - 15,534 15,534
Profit/(loss) for the period 28,863 9,207 6,412 24,432 13,968 11,355 (50,147) 44,090
Total assets 1,200,349 576,579 163,519 1,133,767 569,676 1,030,983 763,114 5,437,987
Total liabilities 4,700,917
Audited - June 2021
Net interest income
65,829 22,257 12,073 63,898 30,579 39,348 (467)233,517
Net other income
3,343 2,143 1,946 2,723 881 2,684 (141)13,579
Net operating income 69,172 24,400 14,019 66,621 31,460 42,032 (608)247,096
Operating expenses
3,787 4,284 6,833 11,340 2,124 12,390 76,900 117,658
Profit/(loss) before impaired asset
expense and income tax
65,385 20,116 7,186 55,281 29,336 29,642 (77,508) 129,438
Fair value gain on investments
- - - - 700 -3,3924,092
Impaired asset expense
5,298 -2,0815,649 1,649 297 -14,974
Profit/(loss) before income tax 60,087 20,116 5,105 49,632 28,387 29,345 (74,116) 118,556
Income tax expense
- - - - - - 31,530 31,530
Profit/(loss) for the period 60,087 20,116 5,105 49,632 28,387 29,345 (105,646) 87,026
Total assets 1,287,978 601,505 137,910 1,225,710 586,318 1,149,610 688,582 5,677,613
Total liabilities 4,915,921

P.15
3 Net interest income
Unaudited Unaudited Audited
6 Months to 6 Months to 12 Months to
$000's
December 2021 December 2020 June 2021
Interest income
Cash and cash equivalents
149 47 119
Investments
2,782 3,635 6,979
Finance receivables
113,863 118,751 232,845
Finance receivables - reverse mortgages
46,792 43,954 87,992
Total interest income 163,586 166,387 327,935
Interest expense
Retail deposits
18,708 33,487 55,273
Other borrowings
20,524 17,064 35,609
Net interest expense on derivative financial instruments
451 2,623 3,536
Total interest expense 39,683 53,174 94,418
Net interest income 123,903 113,213 233,517
4 Operating expenses
Unaudited Unaudited Audited
6 Months to 6 Months to 12 Months to
$000's
December 2021 December 2020 June 2021
Personnel expenses 30,884 30,852 61,476
Directors' fees
563 549 1,129
Superannuation
768 718 1,535
Depreciation - property, plant and equipment
1,388 1,473 2,995
Legal and professional fees
903 1,346 2,876
Advertising and public relations
2,185 2,181 5,138
Depreciation - right of use asset
1,154 1,159 2,312
Technology services
4,785 3,407 7,262
Telecommunications, stationery and postage
842 900 1,843
Customer acquisition costs
2,888 4,372 6,982
Amortisation of intangible assets
3,082 6,831 9,308
Other operating expenses
1

7,850 7,342 14,802
Total operating expenses 57,292 61,130 117,658
1
Other operating expenses include compensation of auditor which is disclosed in Note 5 - Compensation of auditor.
5 Compensation of auditor
Unaudited Unaudited Audited
6 Months to 6 Months to 12 Months to
$000's
December 2021 December 2020 June 2021
Audit and review of the financial statements
1
386 465 790
Other assurance services paid to auditor
2

51 51 103
Total compensation of auditor 437 516 893
1
Audit and review of the financial statements includes fees paid for both the audit of the annual financial statements and review of interim
financial statements.
2
Other assurance related services paid to the auditor comprise regulatory assurance services, agreed upon procedure engagements and
supervisor reporting.

P.16
6 Impaired asset expense
At each reporting date, the Group applies a three stage approach to measuring expected credit loss to finance receivables not
carried at fair value. The following table details impairment charges of those finance receivables for the six months ended 31
December 2021.
Unaudited Unaudited Audited
6 Months to 6 Months to 12 Months to
$000's
December 2021 December 2020 June 2021
Non-securitised
Individually impaired asset expense
6,266 3,414 9,131
Collectively impaired asset expense
1,877 1,099 6,001
Total non-securitised impaired asset expense 8,143 4,513 15,132
Securitised
Collectively impaired asset expense
392 25 (158)
Total securitised impaired asset expense 392 25 (158)
Total
Individually impaired asset expense
6,266 3,414 9,131
Collectively impaired asset expense
2,269 1,124 5,843
Total impaired asset expense 8,535 4,538 14,974
7 Earnings per share
Earnings
Per Share
Net Profit
After Tax
Weighted
Average No.
of Shares
Cents $000's 000's
Unaudited - December 2021
Basic earnings
8.08 47,516 588,190
Diluted earnings
8.08 47,516 588,190
Unaudited - December 2020
Basic earnings
7.57 44,090 582,081
Diluted earnings
7.57 44,090 582,081
Audited - June 2021
Basic earnings
14.92 87,026 583,467
Diluted earnings
14.92 87,026 583,467

P.17
Financial Position
8 Finance receivables
(a)Finance receivables held at amortised cost
Unaudited Unaudited Audited
$000's
December 2021 December 2020 June 2021
Non-securitised
Neither at least 90 days past due nor impaired - at amortised cost
3,203,046 2,938,904 3,140,490
At least 90 days past due - at amortised cost
38,593 45,761 36,882
Individually impaired - at amortised cost
63,965 33,667 38,143
Gross finance receivables 3,305,604 3,018,332 3,215,515
Less provision for impairment
(52,651)
(55,415)
(53,448)
Total non-securitised finance receivables 3,252,953 2,962,917 3,162,067
Securitised
Neither at least 90 days past due nor impaired - at amortised cost
273,650 79,645 126,638
At least 90 days past due - at amortised cost
263 448 -
Gross finance receivables 273,913 80,093 126,638
Less provision for impairment
(632)(422)(239)
Total securitised finance receivables 273,281 79,671 126,399
Total
Neither at least 90 days past due nor impaired - at amortised cost
3,476,696 3,018,549 3,267,128
At least 90 days past due - at amortised cost
38,856 46,209 36,882
Individually impaired - at amortised cost
63,965 33,667 38,143
Gross finance receivables 3,579,517 3,098,425 3,342,153
Less provision for impairment
(53,283) (55,837) (53,687)
Total finance receivables 3,526,234 3,042,588 3,288,466

P.18
8 Finance receivables (continued)
(a)Finance receivables held at amortised cost (continued)
Movement in provision
The following table details the movement from the opening balance to the closing balance of the provision for impairment losses
by class.
Lifetime Lifetime
ECL ECL
12 - Month Not Credit Credit Specific
$000's ECL Impaired Impaired Provision Total
Unaudited - December 2021
Non-securitised
Impairment allowance as at 30 June 2021 26,591 2,405 16,823 7,629 53,448
Changes in loss allowance
Transfer between stages (2,323) (1,102) 714 2,711 -
New and increased provision (net of collective
provision releases)
(1,149) 391 6,769 3,555 9,566
Recovery of amounts written off - - (1,423) -(1,423)
Credit impairment charge (3,472) (711)6,0606,266 8,143
Recovery of amounts previously written off - - 1,423-1,423
Write offs - - (9,109)(1,219) (10,328)
Effect of changes in foreign exchange rate (35)-- -(35)
Acquisition of portfolio --- - -
Impairment allowance as at 31 December 2021 23,084 1,694 15,197 12,676 52,651
Securitised
Impairment allowance as at 30 June 2021 216 22 1 -239
Changes in loss allowance
Transfer between stages (2)(27)29 - -
New and increased provision (net of collective
provision releases) 231 77 84 -
392
Recovery of amounts written off - - - - -
Credit impairment charge 229 50 113 -392
Recovery of amounts previously written off - - - - -
Write offs - - - - -
Effect of changes in foreign exchange rate -1- - 1
Acquisition of portfolio --- - -
Impairment allowance as at 31 December 2021 445 73 114 -632
Total
Impairment allowance as at 30 June 2021 26,807 2,427 16,824 7,629 53,687
Changes in loss allowance
Transfer between stages (2,325) (1,129) 743 2,711 -
New and increased provision (net of collective
provision releases)
(918)4686,853 3,555 9,958
Recovery of amounts written off - - (1,423) -(1,423)
Credit impairment charge (3,243) (661)6,1736,266 8,535
Recovery of amounts previously written off - - 1,423-1,423
Write offs - - (9,109)(1,219) (10,328)
Effect of changes in foreign exchange rate (35)1- - (34)
Acquisition of portfolio --- - -
Impairment allowance as at 31 December 2021 23,529 1,767 15,311 12,676 53,283

P.19
8 Finance receivables (continued)
(a)Finance receivables held at amortised cost (continued)
Movement in provision (continued)
Lifetime Lifetime
ECL ECL
12 - Month Not Credit Credit Specific
$000's ECL Impaired Impaired Provision Total
Unaudited - December 2020
Non-securitised
Impairment allowance as at 30 June 2020 32,160 2,143 22,668 5,301 62,272
Changes in loss allowance
Transfer between stages (860)(395)153 1,102 -
New and increased provision (net of collective
provision releases)
(1,197) 1024,605 2,312 5,822
Recovery of amounts written off
-
- (1,309) -(1,309)
Credit impairment charge (2,057) (293)3,4493,414 4,513
Recovery of amounts previously written off - - 1,309-1,309
Write offs - - (10,199) (2,481) (12,680)
Effect of changes in foreign exchange rate (1)11 -1
Acquisition of portfolio --- - -
Impairment allowance as at 31 December 2020 30,102 1,851 17,228 6,234 55,415
Securitised
Impairment allowance as at 30 June 2020 260 23 114 -397
Changes in loss allowance
Transfer between stages 23 1 (24)--
New and increased provision (net of collective
provision releases)
(33)(10)68
-
25
Recovery of amounts written off - - - -
-
Credit impairment charge (10)(9)44 -25
Recovery of amounts previously written off --- - -
Write offs --- - -
Effect of changes in foreign exchange rate --- - -
Acquisition of portfolio --- - -
Impairment allowance as at 31 December 2020 250 14 158 -422
Total
Impairment allowance as at 30 June 2020 32,420 2,166 22,782 5,301 62,669
Changes in loss allowance
Transfer between stages (837)(394)129 1,102 -
New and increased provision (net of collective
provision releases)
(1,230) 924,673 2,312 5,847
Recovery of amounts written off - - (1,309) -(1,309)
Credit impairment charge (2,067) (302)3,4933,414 4,538
Recovery of amounts previously written off - - 1,309-1,309
Write offs - - (10,199) (2,481) (12,680)
Effect of changes in foreign exchange rate (1)11 -1
Acquisition of portfolio --- - -
Impairment allowance as at 31 December 2020 30,352 1,865 17,386 6,234 55,837

P.20
8 Finance receivables (continued)
(a)Finance receivables held at amortised cost (continued)
Movement in provision (continued)
Lifetime Lifetime
ECL ECL
12 - Month Not Credit Credit Specific
$000's ECL Impaired Impaired Provision Total
Audited - 30 June 2021
Non-securitised
Impairment allowance as at 30 June 2020 32,160 2,143 22,668 5,301 62,272
Changes in loss allowance
Transfer between stages (2,485) (1,090) (22)3,597-
New and increased provision (net of collective
provision releases)
(3,207) 1,329 13,715 6,03417,871
Recovery of amounts written off - - (2,739) -(2,739)
Credit impairment charge (5,692) 239 10,954 9,631 15,132
Recovery of amounts previously written off - - 2,739 -2,739
Write offs - - (19,729) (7,303) (27,032)
Effect of changes in foreign exchange rate (10)13 -(6)
Acquisition of portfolio 133 22188 -343
Impairment allowance as at 30 June 2021 26,591 2,405 16,823 7,629 53,448
Securitised
Impairment allowance as at 30 June 2020 260 23 114 -397
Changes in loss allowance
Transfer between stages (4)(3)7 - -
New and increased provision (net of collective
provision releases)
(40)2(120)-(158)
Credit impairment charge (44)(1)(113)-(158)
Recovery of amounts previously written off -----
Write offs -----
Effect of changes in foreign exchange rate -----
Acquisition of portfolio -----
Impairment allowance as at 30 June 2021 216 22 1 -239
Total
Impairment allowance as at 30 June 2020 32,420 2,166 22,782 5,301 62,669
Changes in loss allowance
Transfer between stages (2,489) (1,093) (15)3,597-
New and increased provision (net of collective
provision releases)
(3,247) 1,331 13,595 6,03417,713
Recovery of amounts written off - - (2,739) -(2,739)
Credit impairment charge (5,736) 238 10,841 9,631 14,974
Recovery of amounts previously written off - - 2,739 -2,739
Write offs - - (19,729) (7,303) (27,032)
Effect of changes in foreign exchange rate (10)13 -(6)
Acquisition of portfolio 133 22188 -343
Impairment allowance as at 30 June 2021 26,807 2,427 16,824 7,629 53,687

P.21
8 Finance receivables (continued)
(a)Finance receivables held at amortised cost (continued)
Impact of changes in gross finance receivables held at amortised cost on allowance for ECL
Lifetime Lifetime
ECL ECL
12 - Month Not Credit Credit Specific
$000's ECL Impaired Impaired Provision Total
Unaudited - December 2021
Gross finance receivables as at 30 June 2021 3,092,653 165,793 45,564 38,143 3,342,153
Transfer between stages (48,097) (11,584) 20,313 39,368 -
Additions 897,124 - - 906 898,030
Deletions (594,443) (34,662) (8,077) (13,091) (650,273)
Write offs - - (9,032) (1,361) (10,393)
Gross finance receivables as at 31 December 2021 3,347,237 119,547 48,768 63,965 3,579,517
Unaudited - December 2020
Gross finance receivables as at 30 June 2020 2,826,208 183,260 73,729 24,667 3,107,864
Transfer between stages (50,423) 31,814 3,841 14,768 -
Additions 796,845 - - - 796,845
Deletions (733,346) (36,470) (19,081) (3,233) (792,130)
Write offs - - (11,619) (2,535) (14,154)
Gross finance receivables as at 31 December 2020 2,839,284 178,604 46,870 33,667 3,098,425
Audited - June 2021
Gross finance receivables as at 30 June 2020 2,826,208 183,260 73,729 24,667 3,107,864
Transfer between stages (103,233) 67,419 13,314 22,499 -
Additions 1,435,408 - - 955 1,436,363
Deletions (1,065,730) (84,886) (20,337) (466)(1,171,419)
Write offs - - (21,142) (9,512) (30,655)
Gross finance receivables as at 30 June 2021 3,092,653 165,793 45,564 38,143 3,342,153
(b)Finance receivables held at fair value
Unaudited Unaudited Audited
$000's December 2021 December 2020 June 2021
Finance receivables - reverse mortgages 1,778,066 1,607,352 1,676,073
Total finance receivables - reverse mortgages 1,778,066 1,607,352 1,676,073
9 Borrowings
Unaudited Unaudited Audited
$000's December 2021 December 2020 June 2021
Deposits 3,332,409 3,268,554 3,183,454
Total borrowings related to deposits 3,332,409 3,268,554 3,183,454
Unsubordinated notes 560,307 444,845 521,399
Securitised borrowings 1,152,521 897,228 1,043,516
Certificate of deposit 109,637 -69,853
Repurchase agreement -31,88940,365
Total other borrowings 1,822,465 1,373,962 1,675,133

P.22
9 Borrowings (Continued)
Deposits and unsubordinated notes rank equally and are unsecured.
The Group has the following unsubordinated notes on issue at balance sheet date. Australian (AU) borrowings are stated in their
functional currency AU dollars.
Principal Valuation Issue Date Maturity Date
Frequency of
Interest
Repayment
$150 million Amortised cost 21 September 2017 21 September 2022 Semi-annually
$125 million
AU $100 million
AU $75 million
AU $45 million
AU $45 million
Amortised cost
Amortised cost
Amortised cost
Amortised cost
Amortised cost
12 April 2019
13 November 2019
15 January 2021
8 March 2021
9 July 2021
12 April 2024
13 May 2022
21 April 2023
21 April 2023
9 July 2024
Semi-annually
Quarterly
Quarterly
Quarterly
Quarterly
At 31 December 2021 the Group had the following securitised borrowings outstanding:
•Heartland Auto Receivables Warehouse Trust 2018 - 1 securitisation facility $400 million, drawn $235 million (December
2020: limit $300 million, drawn $68 million; June 2021: limit $300 million, drawn $108 million). Securitised borrowings held
by investors are secured over the assets of the Heartland Auto Receivables Warehouse Trust 2018-1 (predominantly motor
loans). The facility has a maturity date of 29 August 2023.
•Senior Warehouse Trust securitisation facility AU $600 million, drawn AU $552 million (December 2020: AU $600 million,
drawn AU $481 million; June 2021: AU $600 million, drawn AU $556 million). Notes issued to investors are secured over the
assets of Seniors Warehouse Trust (predominantly reverse mortgage loans). The facility has a maturity date of 30 September
2022.
•Senior Warehouse Trust No.2 securitisation facility AU $250 million, drawn AU $180 million (December 2020: AU $250
million, drawn AU $156 million; June 2021: AU $250 million, drawn AU $182 million). Notes issued to investors are secured
over the assets of Seniors Warehouse Trust No.2 (predominantly reverse mortgage loans). The facility has a maturity date of
1 July 2022.
•Atlas 2020-1 Trust securitisation facility AU $136 million, drawn AU $136 million (December 2020: AU $139 million, AU $139
million drawn; June 2021: AU $137 million, AU $137 million drawn). Loans issued to investors are secured over the assets of
Atlas 2020-1 Trust (predominantly reverse mortgage loans) and has a maturity date of 24 September 2050.

P.23
10 Share capital and dividends
Unaudited Unaudited Audited
December 2021 December 2020 June 2021
000's Number of Shares Number of Shares Number of Shares
Issued shares
Opening balance 585,904 580,979 580,979
Dividend reinvestment plan 3,930 2,442 4,925
Closing balance 589,834 583,421 585,904
HGH had issued 3,930,116 new shares at $2.2713 per share on 15 September 2021 under the dividend reinvestment plan for the
period (2021: 2,482,921 new shares issued at $1.8035 per share on 16 March 2021 and 2,442,338 new shares were issued at
$1.2470 per share on 9 October 2020 under dividend reinvestment plan).
Dividends paid
6 Months to December 2021 12 Months to June 2021
Date Cents Date Cents
Declared Per Share $000's Declared Per Share $000's
Final dividend 24 August 2021 7.0 41,013 17 September 2020 2.5 14,524
Interim Dividend - - - 22 February 2021 4.0 23,337
Total dividends paid 41,013 37,861
11 Related party transactions and balances
(a)Transactions with key management personnel
Key management personnel (KMP), are those who, directly or indirectly, have authority and responsibility for planning, directing
and controlling the activities of the Group. This includes all executive staff, Directors and their close family members.
KMP receive personal banking and financial investment services from the Group in the ordinary course of business. The terms and
conditions such as interest rates and collateral along with the risks to the Group are comparable to transactions with other
employees and customers, and did not involve more than the normal risk of repayment or present other unfavourable features.
All other transactions with KMPs and their related entities are made on terms equivalent to those that prevail in arm's length
transactions.
Unaudited Unaudited Audited
6 Months to 6 Months to 12 Months to
$000's December 2021 December 2020 June 2021
Transactions with key management personnel
Interest income 15 26 39
Interest expense (24) (8) (22)
Net transactions with key management personnel (9) 18 17
Due from/(to) key management personnel
Lending 296 574 415
Borrowings - deposits (1,425) (1,778) (23,409)
Net due (to) key management personnel (1,129) (1,204) (22,994)

P.24
11 Related party transactions and balances (continued)
(b)Transactions with related parties
HGH is the ultimate parent company of the Group.
Entities within the Group have regular transactions with each other on agreed terms. The transactions include the provision of tax
and administrative services and customer operations. Banking facilities are provided by HBL to other Group entities on normal
commercial terms as with other customers. There is no lending from subsidiaries within the Group to HGH.
Related party transactions between the Group eliminate on consolidation. Related party transactions outside of the Group are as
follows:
Unaudited Unaudited Audited
6 Months to 6 Months to 12 Months to
$000's December 2021 December 2020 June 2021
Southern Cross Building Society Staff Superannuation (SCBS)
Interest expense payable to SCBS
4 8 12
Management fees receivable from SCBS
5 5 10
ASF Custodians Pty Limited
Audit fees
4 - 7
Heartland Trust (HT)
Dividend paid to HT 453 162 421
(c)Other balances with related parties
Unaudited Unaudited Audited
$000's December 2021 December 2020 June 2021
Southern Cross Building Society Staff Superannuation
Retail deposits owing to SCBS 1,704 1,871 1,760

P.25
12 Fair value
(a)Financial instruments measured at fair value
The following methods and assumptions were used to estimate the fair value of each class of financial asset and liability measured
at fair value on a recurring basis in the consolidated statement of financial position.
The Group has an established framework in performing valuations required for financial reporting purposes including Level 3 fair
values. The Group regularly reviews and calibrates significant unobservable inputs and valuation adjustments in accordance with
market participants’ views. If external valuation specialists are engaged to measure fair values, the Group assesses the evidence
obtained from these specialists to support the conclusion of these valuations. All significant valuations are reported to the
Group's Board Audit and Risk Committee for approval prior to its adoption in the financial statements.
Investments
Investments in public sector securities and corporate bonds are stated at fair value through other comprehensive income (FVOCI),
with the fair value being based on quoted market prices (Level 1 under the fair value hierarchy) or modelled using observable
market inputs (Level 2 under the fair value hierarchy).
Investments valued under Level 2 of the fair value hierarchy are valued either based on quoted market prices or dealer quotes for
similar instruments, or discounted cash flows analysis.
Investments in equity securities are classified as fair value through profit or loss unless an irrevocable election is made by the
Group to measure at FVOCI. Investment in listed securities traded in liquid, active markets where prices are readily observable are
measured under Level 1 of the fair value hierarchy with no modelling or assumptions used in the valuation. Investments in
unlisted equity securities are measured under Level 3 of the fair value hierarchy with the fair value being based on unobservable
inputs using market accepted valuation techniques. Where appropriate, the Group may apply adjustments to the above
mentioned techniques to determine fair value of an equity security to reflect the underlying characteristics. These adjustments
are reflective of market participant considerations in valuing the said security.
Equity Investment in Harmoney Corp Limited
Harmoney Corp Limited (Harmoney) listed on the ASX with a foreign exempt listing on the NZX on 19 November 2020, raising AU
$92.5 million as part of its Initial Public Offering (IPO). As part of the IPO, HGH, alongside other major shareholders, employees
and directors, entered into escrow arrangements that restrict the ability to sell its Harmoney shares, with approximately 72% of
total shares were subject to escrow arrangements (Escrow Restrictions) from the time that Harmoney completed its IPO. There
are two categories of escrowed shares: being unaffiliated escrow shareholders and affiliated escrow shareholders. The timing of
release of escrowed shareholdings is dependent on these categories. The escrowed shareholdings for unaffiliated escrow
shareholders have a two staged release with the first 50% of those escrowed shares released in September 2021 and the
remaining 50% expected to be released at the time or after the release of Harmoney half year financial report for financial year
2022 (FY22). HGH is considered an unaffiliated escrow shareholder for its shareholding recorded at the time of the IPO. The
escrowed shareholdings for affiliated escrow shareholders have a three stage release with the first 25% released in September
2021, a second 25% expected to be released at the time of or after the release of the Harmoney FY22 half year financial report
and the remaining 50% of the affiliated escrow shares (representing 17.7% of the total Harmoney shares on issue) expected to be
released at the time or after the release of the FY22 annual audited financial report.
The Escrow Restrictions have significantly reduced the available trading pool of shares, resulting in an illiquid market for the
instrument, wide bid-ask spreads and volume that is insufficient to meet the definition of an active market under NZ IFRS 13 Fair
Value Measurement for purposes of Harmoney shares traded. As such the quoted price of Harmoney as at 31 December 2021 is
not considered a reliable evidence of fair value and accordingly HGH’s equity investment in Harmoney has not been measured
under Level 1 of the fair value hierarchy.
Consistent with prior reporting periods, the fair value of HGH’s investment in Harmoney has been measured under Level 3 of the
fair value hierarchy using unobservable inputs under a market approach valuation technique. Factors considered relevant to
market participants such as observed trading volumes, bid-ask spreads, market prices of Harmoney’s shares, revenue multiples,
analyst valuations, the impact of Escrow Restrictions, as well as publicly available financial information for Harmoney have all
been taken into account when measuring fair value at reporting date.

P.26
12 Fair value (continued)
(a)Financial instruments measured at fair value (continued)
Investments (continued)
The investment is primarily measured using the volume weighted average price (VWAP) of Harmoney shares traded on the ASX
across a period required to capture sufficient volume and moderate share price volatility attributable to the aforementioned
factors. The VWAP period considered to be the most appropriate, reflecting the characteristics of the underlying share trading
that has occurred, is 6 months to reporting date. This VWAP has been further evaluated through a composite valuation weighting
the closing price of Harmoney shares, revenue multiples of comparable public companies, IPO price and analyst valuations. Both
the VWAP and composite valuation approaches derive reasonably consistent outcomes.
The fair value measurement of HGH’s equity investment in Harmoney was AU $1.90 per share as at reporting date. This was a 6%
premium to the market closing price of AU $1.80 as at 31 December 2021, which if used as the basis for measuring fair value
would result in a $1.1 million lower fair value than that reported. The fair value of the Investment was previously measured at AU
$1.90 per share at 30 June 2021.
Investment properties
Investment properties are initially recorded at their fair value, with subsequent changes in fair value recognised in profit or loss.
Fair value are determined by qualified independent valuers or other similar external evidence, adjusted for changes in market
conditions.
Investment properties are typically acquired through the enforcement of security over finance receivables and are held to earn
rental income or for capital appreciation (or both).
Finance receivables - reverse mortgages
Reverse mortgage loans are classified at fair value through profit or loss (FVTPL). On initial recognition the Group considers the
transaction price to represent the fair value of the loan.
For subsequent measurement the Group has considered if the fair value can be determined by reference to a relevant active
market or observable inputs, but has concluded relevant support is not currently available. In the absence of such market
evidence the Group has used valuation techniques (income approach) including actuarial assessments to consider the fair value.
When the Group enters into a reverse mortgage loan the Group has set expectations regarding the loan’s current and future risk
profile and expectation of performance. This expectation references a wide range of assumptions including:
•Mortality and potential move into care;
•Voluntary exits;
•House price changes;
•No negative equity guarantee; and
•Interest rate margin.
At balance date the Group does not consider any of the above expectations to have moved outside of the original expectation
range. Therefore the Group has continued to estimate the fair value of the portfolio at transaction price. There has been no fair
value movement recognised in profit or loss during the period. Fair value is not highly sensitive to the above assumptions due to
the nature of reverse mortgage loans. In particular, given conservative origination loan-to-value ratio criteria, a material
deterioration in house prices combined with a material increase in interest rates over a sustained period of time would likely need
to occur before any potential impact to fair value. While noting the significant uncertainty around future economic conditions,
based on current judgment there is no evidence that COVID-19 has impacted or will have a long-term adverse impact on market
conditions, particularly regarding the key elements of house prices or interest rates, that would materially influence the fair value
of the reverse mortgage portfolio at balance date.
The Group will continue to reassess the existence of a relevant active market and movements in expectations on an on-going
basis.

P.27
12 Fair value (continued)
(a)Financial instruments measured at fair value (continued)
Derivative financial instruments
Interest rate and foreign currency related contracts are recognised in the financial statements at fair value. Fair values are
determined from observable market prices as at the reporting date, discounted cash flow models or option pricing models as
appropriate (Level 2 under the fair value hierarchy).
The following table analyses financial instruments measured at fair value at the reporting date by the level in the fair value
hierarchy into which each fair value measurement is categorised. The amounts are based on the values recognised in the
consolidated statement of financial position.
$000's Level 1 Level 2 Level 3 Total
Unaudited - December 2021
Assets
Investments 229,453 61,745 22,459 313,657
Investment properties - - 11,832 11,832
Derivative financial instruments -21,714-21,714
Finance receivables - reverse mortgages --1,778,066 1,778,066
Total financial assets measured at fair value 229,453 83,459 1,812,357 2,125,269
Liabilities
Derivative financial instruments -3,548-3,548
Total financial liabilities measured at fair value -3,548-3,548
Unaudited - December 2020
Assets
Investments 328,620 112,831 21,512 462,963
Investment properties - - 11,132 11,132
Derivative financial instruments -15,023-15,023
Finance receivables - reverse mortgages --1,607,352 1,607,352
Total financial assets measured at fair value 328,620 127,854 1,639,996 2,096,470
Liabilities
Derivative financial instruments -12,805-12,805
Total financial liabilities measured at fair value -12,805-12,805
Audited - June 2021
Assets
Investments 259,041 92,476 20,667 372,184
Investment properties - - 11,832 11,832
Derivative financial instruments -14,139-14,139
Finance receivables - reverse mortgages --1,676,073 1,676,073
Total financial assets measured at fair value 259,041 106,615 1,708,572 2,074,228
Liabilities
Derivative financial instruments -4,802-4,802
Total financial liabilities measured at fair value -4,802-4,802
There were no transfers between any fair value hierarchy levels in the six months ended 31 December 2021 (December 2020: nil;
June 2021: nil).

P.28
12 Fair value (continued)
(a)Financial instruments measured at fair value (continued)
The movement in Level 3 assets measured at fair value are below:
Finance Receivables Investment
$000's
-Reverse MortgageInvestments Properties Total
Unaudited - December 2021
As at 30 June 2021
1,676,073 20,667 11,832 1,708,572
New loans
190,734 - - 190,734
Repayments
(127,057) - - (127,057)
Capitalised Interest and fees
49,718 - - 49,718
Purchase of investments
- 1,885 - 1,885
Fair value (loss) on investment
- (93) - (93)
Other
(11,402) - - (11,402)
As at 31 December 2021 1,778,066 22,459 11,832 1,812,357
Unaudited - December 2020
As at 30 June 2020
1,538,585 16,335 11,132 1,566,052
New loans
145,674 - - 145,674
Repayments
(119,653) - - (119,653)
Capitalised Interest and fees
45,878 - - 45,878
Purchase of investments
- - - -
Fair value gain on investment
- 5,177 - 5,177
Other
(3,132) - - (3,132)
As at 31 December 2020 1,607,352 21,512 11,132 1,639,996
Audited - June 2021
As at 30 June 2020
1,538,585 16,335 11,132 1,566,052
New loans
300,689 - - 300,689
Repayments
(257,999) - - (257,999)
Capitalised Interest and fees
91,812 - - 91,812
Purchase of investments
- 940 - 940
Fair value gain on investment
- 3,392 700 4,092
Other
2,986 - - 2,986
As at 30 June 2021 1,676,073 20,667 11,832 1,708,572

P.29
12 Fair value (continued)
(b)Financial instruments not measured at fair value
The following table sets out financial instruments not measured at fair value, compares their carrying value against their fair value
and analyses them by level in the fair value hierarchy.
Unaudited Unaudited Audited
December 2021 December 2020 June 2021
Total Total Total
Fair Value Total Fair Carrying Total Fair Carrying Total Fair Carrying
$000's Hierarchy Value Value Value Value Value Value
Assets
Cash and cash equivalents Level 1 207,666 207,666 152,818 152,818 182,333 182,333
Investments
1
Level 2 4,615 4,616 7,413 7,405 5,640 5,639
Finance receivables Level 3 3,563,778 3,526,234 3,062,211 3,042,588 3,362,536 3,288,466
Other financial assets Level 3 2,322 2,322 1,085 1,085 2,292 2,292
Total financial assets 3,778,381 3,740,838 3,223,527 3,203,896 3,552,801 3,478,730
Liabilities
Retail deposits Level 2 3,334,667 3,332,409 3,287,485 3,268,554 3,192,708 3,183,454
Borrowings - securitised Level 2 1,152,521 1,152,521 897,228 897,228 1,043,516 1,043,516
Other borrowings Level 2 669,944 669,944 476,734 476,734 631,617 631,617
Other financial liabilities Level 3 30,690 30,690 13,247 13,247 18,687 18,687
Total financial liabilities 5,187,822 5,185,564 4,674,694 4,655,763 4,886,528 4,877,274
1
Included within investments are bank deposits which are held to support the Group's contractual cash flows. Such investments are measured at
amortised cost.

P.30
Risk Management
13 Enterprise risk management program
There have been no material changes in the Group’s policies for managing risk, or material exposures to any new types of risk
since the reporting date of the previous statement. Refer to the Group’s Financial Statements for the year ended 30 June 2021 for
the detailed policies.
14 Credit risk exposure
(a)Maximum exposure to credit risk at the relevant reporting dates
The following table represents the maximum credit risk exposure, without taking account of any collateral held. The exposures set
out below are based on net carrying amounts as reported in the consolidated statement of financial position.
Unaudited Unaudited Audited
$000's December 2021 December 2020 June 2021
On balance sheet:
Cash and cash equivalents 207,666 152,818 182,333
Investments 295,814 448,856 357,156
Finance receivables 3,526,234 3,042,588 3,288,466
Finance receivables - reverse mortgages 1,778,066 1,607,352 1,676,073
Derivative financial assets 21,714 15,023 14,139
Other financial assets 2,322 1,085 2,292
Total on balance sheet credit exposures 5,831,816 5,267,722 5,520,459
Off balance sheet:
Letters of credit, guarantee commitments and performance bonds 7,217 6,145 13,484
Undrawn facilities available to customers 365,623 280,750 299,544
Conditional commitments to fund at future dates 21,646 24,570 19,083
Total off balance sheet credit exposures 394,486 311,465 332,111
Total credit exposures 6,226,302 5,579,187 5,852,570
As at 31 December 2021 there were no undrawn lending commitments available to counterparties for whom drawn balances are
classified as individually impaired (December 2020:nil; June 2021: $0.216 million).
(b)Concentration of credit risk by geographic region
Unaudited Unaudited Audited
$000's December 2021 December 2020 June 2021
New Zealand 4,749,474 4,098,553 4,402,656
Australia 1,299,626 1,196,808 1,243,522
Rest of the world
1
230,485 339,663 260,079
6,279,585 5,635,024 5,906,257
Provision for impairment (53,283) (55,837) (53,687)
Total credit exposures 6,226,302 5,579,187 5,852,570
1
These overseas assets are primarily NZD-denominated investments in AA+ and higher rated securities issued by offshore supranational agencies
e.g. Kauri Bonds.

P.31
14 Credit risk exposure (continued)
(c)Concentration of credit risk by industry sector
The Australian and New Zealand Standard Industrial Classification (ANZSIC) codes have been used as the basis for categorising
customer and investee industry sectors.
Unaudited Unaudited Audited
$000's December 2021 December 2020 June 2021
Agriculture 667,835 663,982 670,428
Forestry and fishing 149,561 149,126 153,160
Mining 14,217 12,076 12,684
Manufacturing 85,737 77,108 76,951
Finance and insurance 701,269 698,607 674,854
Wholesale trade 35,543 45,734 56,522
Retail trade and accommodation 338,163 265,798 279,388
Households 3,233,026 2,804,711 2,994,980
Other business services 172,647 146,811 148,011
Construction 304,593 213,273 241,668
Rental, hiring and real estate services 180,689 169,253 185,320
Transport and storage 311,068 277,926 297,920
Other 85,237 110,619 114,371
6,279,585 5,635,024 5,906,257
Provision for impairment (53,283) (55,837) (53,687)
Total credit exposures 6,226,302 5,579,187 5,852,570

P.32
15 Liquidity risk
Liquidity risk is the risk that the Group is unable to meet its payment obligations as they fall due. The timing mismatch of cash
flows and the related liquidity risk in all banking operations is closely monitored by the Group.
Measurement of liquidity risk is designed to ensure that the Group has the ability to generate or obtain sufficient cash in a timely
manner and at a reasonable price to meet its financial commitments on a daily basis.
The Group’s exposure to liquidity risk is governed by a policy approved by the Board and managed by the Asset and Liability
Committee (ALCO). This policy sets out the nature of the risk which may be taken and aggregate risk limits, which ALCO must
observe. Within this, the objective of the ALCO is to derive the most appropriate strategy for the Group in terms of a mix of assets
and liabilities given its expectations of future cash flows, liquidity constraints and capital adequacy. The ALCO employs asset and
liability cash flow modelling to determine appropriate liquidity and funding strategies.
Reserve Bank of New Zealand (RBNZ) facilities
In March 2020, the Bank was on boarded by the RBNZ as an approved counterparty and executed a 2011 Global Master Repo
Agreement providing an additional source for intra-day liquidity for the Group if required.
From 26 May 2020, the RBNZ made available a Term Lending Facility (TLF) to offer loans for a fixed term of three years at the
Official Cash Rate, with access to the funds linked to banks’ lending under the Business Finance Guarantee Scheme. On 25 May
2021, RBNZ announced to close TLF applications on 28 July 2021.
Additional stimulus provided through a Funding for Lending Programme also commenced in December 2020 designed to enable
banks to provide low-cost lending to the customer.
The Group had not utilised any of these facilities as at 31 December 2021.
The Group holds the following liquid assets and committed funding sources for the purpose of managing liquidity risk:
Unaudited Unaudited Audited
$000's December 2021 December 2020 June 2021
Cash and cash equivalents 207,666 152,818 182,333
Investments 295,814 448,856 357,156
Undrawn committed bank facilities 290,774 459,631 311,993
Total liquidity 794,254 1,061,305 851,482
Contractual liquidity profile of financial liabilities
The following tables present the Group's financial liabilities by relevant maturity groupings based upon contractual maturity date.
The amounts disclosed in the tables represent undiscounted future principal and interest cash flows. As a result, the amounts in
the tables below may differ to the amounts reported on the consolidated statement of financial position.
The contractual cash flows presented below may differ significantly from actual cash flows. This occurs as a result of future
actions by the Group and its counterparties, such as early repayments or refinancing of term loans and borrowings. Deposits and
other public borrowings include customer savings deposits and transactional accounts, which are at call. These accounts provide a
stable source of long term funding for the Group.

P.33
15 Liquidity risk (continued)
Contractual liquidity profile of financial liabilities (continued)
On 0-66-121-22-55+
$000's Demand Months Months Years Years Years Total
Unaudited - December 2021
Non - derivative financial liabilities
Retail deposits 847,180 1,776,648 568,895 105,741 54,417 -3,352,881
Other borrowings -231,215938,328 384,597 158,088 172,881 1,885,109
Lease liabilities -1,4321,441 2,742 7,320 5,990 18,925
Other financial liabilities -30,690- - - - 30,690
Total non - derivative financial liabilities 847,180 2,039,985 1,508,664 493,080 219,825 178,871 5,287,605
Derivative financial liabilities
Inflows from derivatives -13,9514,065 6,936 5,303 -30,255
Outflows from derivatives -16,1134,222 7,396 5,107 -32,838
Total derivative financial liabilities -2,162157 460 (196)-2,583
Undrawn facilities available to customers 365,623 - - - - -365,623
Undrawn committed bank facilities 290,774 - - - - -290,774
Unaudited - December 2020
Non - derivative financial liabilities
Retail deposits 994,767 1,382,593 554,159 275,364 94,526 -3,301,409
Other borrowings -97,07013,460 1,027,935 156,311 157,875 1,452,651
Lease liabilities -1,4121,429 2,895 7,985 8,139 21,860
Other financial liabilities -13,247- - - - 13,247
Total non - derivative financial liabilities 994,767 1,494,322 569,048 1,306,194 258,822 166,014 4,789,167
Derivative financial liabilities
Inflows from derivatives -136,04214,178 678 337 -151,235
Outflows from derivatives -141,90617,172 3,879 767 -163,724
Total derivative financial liabilities -5,8642,994 3,201 430 -12,489
Undrawn facilities available to customers 280,750 - - - - -280,750
Undrawn committed bank facilities 459,631 - - - - -459,631
Audited - June 2021
Non - derivative financial liabilities
Retail deposits 971,924 1,291,863 560,232 292,091 91,107 -3,207,217
Other borrowings -124,431120,855 1,205,547 157,855 181,244 1,789,932
Lease liabilities -1,4191,433 2,836 7,605 7,085 20,378
Other financial liabilities -18,687- - - - 18,687
Total non - derivative financial liabilities 971,924 1,436,400 682,520 1,500,474 256,567 188,329 5,036,214
Derivative financial liabilities
Inflows from derivatives -14,251610 800 12 -15,673
Outflows from derivatives -16,7502,174 1,316 16 -20,256
Total derivative financial liabilities -2,4991,564 516 4 -4,583
Undrawn facilities available to customers 299,544 - - - - -299,544
Undrawn committed bank facilities 311,993 - - - - -311,993

P.34
16 Interest rate risk
Contractual repricing analysis
The interest rate risk profile of financial assets and liabilities that follows has been prepared on the basis of maturity or next
repricing date, whichever is earlier.
Non-
0-33-66-121-22+ Interest
$000's Months Months Months Years Years Bearing Total
Unaudited - December 2021
Financial assets
Cash and cash equivalents 207,665 - - - - 1 207,666
Investments 22,884 1,101 -120,826151,003 22,459 318,273
Finance receivables 1,623,877 166,312 312,265 503,151848,174 72,455 3,526,234
Finance receivables - reverse mortgages 1,778,066 - - - - -1,778,066
Derivative financial assets - - - - -21,71421,714
Other financial assets - - - - -2,3222,322
Total financial assets 3,632,492 167,413 312,265 623,977 999,177 118,951 5,854,275
Financial liabilities
Retail deposits 1,870,753 730,076 561,848 102,537 50,654 16,541 3,332,409
Other borrowings 1,486,681 60,714 151,260 -123,810-1,822,465
Derivative financial liabilities - - - - -3,5483,548
Lease liabilities - - - - -16,98016,980
Other financial liabilities - - - - -30,69030,690
Total financial liabilities 3,357,434 790,790 713,108 102,537 174,464 67,759 5,206,092
Effect of derivatives held for risk
management
669,798 (67,794) (8,974) (295,757) (297,273) - -
Net financial assets/(liabilities) 944,856 (691,171) (409,817) 225,683 527,440 51,192 648,183
Unaudited - December 2020
Financial assets
Cash and cash equivalents 152,803 - - - - 15 152,818
Investments 55,036 23,265 38,705 75,963 255,886 21,513 470,368
Finance receivables 1,481,611 134,370 286,777 469,999 656,238 13,593 3,042,588
Finance receivables - reverse mortgages 1,607,352 - - - - -1,607,352
Derivative financial assets - - - - -15,02315,023
Other financial assets - - - - -1,0851,085
Total financial assets 3,296,802 157,635 325,482 545,962 912,124 51,229 5,289,234
Financial liabilities
Retail deposits 1,738,119 611,540 546,713 266,193 86,697 19,292 3,268,554
Other borrowings 1,086,068 987 -156,063130,844 -1,373,962
Derivative financial liabilities - - ---12,80512,805
Lease liabilities - - ---19,36319,363
Other financial liabilities - - ---13,24713,247
Total financial liabilities 2,824,187 612,527 546,713 422,256 217,541 64,707 4,687,931
Effect of derivatives held for risk
management
463,422 (63,969) (92,103) (130,193) (177,157) - -
Net financial assets/(liabilities) 936,037 (518,861) (313,334) (6,487) 517,426 (13,478) 601,303

P.35
16 Interest rate risk (continued)
Contractual repricing analysis (continued)
Non-
0-33-66-121-22+ Interest
$000's Months Months Months Years Years Bearing Total
Audited - June 2021
Financial assets
Cash and cash equivalents 182,323 - - - - 10 182,333
Investments 31,896 8,034 19,669 53,505 244,052 20,667 377,823
Finance receivables 1,587,718 151,674 299,305 462,900 715,032 71,837 3,288,466
Finance receivables - reverse mortgages 1,676,073 - - - - -1,676,073
Derivative financial assets - - - - -14,13914,139
Other financial assets - - - - -2,2922,292
Total financial assets 3,478,010 159,708 318,974 516,405 959,084 108,945 5,541,126
Financial liabilities
Retail deposits 1,670,667 570,068 554,340 285,025 85,077 18,277 3,183,454
Other borrowings 1,342,612 50,837 -153,751127,933 -1,675,133
Derivative financial liabilities - - ---4,8024,802
Lease liabilities - - ---18,16618,166
Other financial liabilities - - ---18,68718,687
Total financial liabilities 3,013,279 620,905 554,340 438,776 213,010 59,932 4,900,242
Effect of derivatives held for risk
management
474,010 (9,023) (146,067) (85,669) (233,251) - -
Net financial assets/(liabilities) 938,741 (470,220) (381,433) (8,040) 512,823 49,013 640,884

P.36
Other Disclosures
17 Structured entities
A structured entity is one which has been designed such that voting or similar rights are not the dominant factor in deciding who
controls the entity. Structured entities are created to accomplish a narrow and well-defined objective such as the securitisation or
holding of particular assets or the execution of a specific borrowing or lending transaction. Structured entities are consolidated
where the substance of the relationship is that the Group controls the structured entity.
(a)Heartland Cash and Term PIE Fund (Heartland PIE Fund)
The Group controls the operations of the Heartland PIE Fund which is a portfolio investment entity that invests in the Group's
deposits. Investments of Heartland PIE Fund are represented as follows:
Unaudited Unaudited Audited
$000's December 2021 December 2020 June 2021
Deposits 151,830 167,147 153,244
(b)Heartland Auto Receivable Warehouse Trust 2018-1 (Auto Warehouse)
The Auto Warehouse securitises motor loan receivables as a source of funding.
The Group continues to recognise the securitised assets and associated borrowings in the consolidated statement of financial
position as the Group remains exposed to and has the ability to affect variable returns from those assets and liabilities. Although
the Group recognises those interests in Auto Warehouse, the loans sold to the Trust are set aside for the benefit of investors in
Auto Warehouse and other depositors and lenders to the Group have no recourse to those assets.
Unaudited Unaudited Audited
$000's December 2021 December 2020 June 2021
Cash and cash equivalents 19,840 5,876 9,047
Finance receivables - motor 273,289 79,672 126,399
Other borrowings (275,787) (81,541) (128,125)
(c)Seniors Warehouse Trust, Seniors Warehouse Trust No.2 (together the SW Trusts) and ASF Settlement Trust (ASF Trust)
SW Trusts and ASF Trust (collectively the Trusts) form part of ASF's reverse mortgage business and were set up by Australian
Seniors Finance Limited (ASF) as asset holding entities. The Trustee for the Trusts is ASF Custodians Pty Limited and the Trust
Manager is ASF. The reverse mortgage loans held by the Trusts are set aside for the benefit of the investors in the Trusts. The
balances of SW Trusts and ASF Trust are represented as follows:
Unaudited Unaudited Audited
$000's December 2021 December 2020 June 2021
Cash and cash equivalents 29,509 21,048 29,170
Finance receivables - reverse mortgages 992,664 839,219 934,523
Other borrowings (798,735) (710,034) (822,122)
(d)Atlas 2020-1 Trust (Atlas Trust)
Atlas Trust was set up on 11 September 2020 as part of ASF's reverse mortgage business similar to the existing SW Trusts and ASF
Trust. The Trustee for the Trust is BNY Trust Company of Australia Limited and the Trust Manager is ASF. The balances of Atlas
Trust are represented as follows:
Unaudited Unaudited Audited
$000's December 2021 December 2020 June 2021
Cash and cash equivalents 18,118 9,629 17,592
Finance receivables - reverse mortgages 136,537 145,935 140,044
Other borrowings (148,453) (148,855) (145,943)

P.37
18 Insurance business, securitisation, funds management, other fiduciary activities
Insurance business
MIL, a subsidiary of HBL, ceased writing insurance policies in 2020 with the periodic policies expected to expire in 2025.
The Group's aggregate amount of insurance business comprises the total consolidated assets of MIL of $8.3 million (December
2020: $10.8 million; June 2021: $8.5 million), which represents 0.14% of the total consolidated assets of the Group (December
2020: 0.20%; June 2021: 0.15%).
Securitisation, funds management and other fiduciary activities
There have been no material changes to the Group’s involvement in securitisation activities. There have been no material changes
to the Group’s involvement in funds management and other fiduciary activities, in either case since the reporting date of the
previous financial statements.
Risk management
The Group has in place policies and procedures to ensure that the fiduciary activities identified above are conducted in an
appropriate manner. It is considered that these policies and procedures will ensure that any difficulties arising from these
activities will not impact adversely on the Group. There has been no material changes to those policies and procedures since the
reporting date of the previous financial statements.
Provision of financial services and asset purchases
Over the accounting period, financial services provided by the Group to entities which were involved in the activities above
(including trust, custodial, funds management and other fiduciary activities) were provided on arm's length terms and conditions
and at fair value.
Any assets purchased from such entities have been purchased on arm's length terms and conditions and at fair value.
19 Contingent liabilities and commitments
The Group, in the ordinary course of business, will be subject to claims and proceedings against it whereby the validity of the
claim will only be confirmed by uncertain future events. In such circumstances, the contingent liabilities would become possible
obligations, or present obligations if known, where the transfer of economic benefit is uncertain or cannot be reliably measured.
Contingent Liabilities are not recognised, but are disclosed, unless they are deemed remote. Where some loss is considered
probable, provisions have been made on a case by case basis.
Contingent liabilities and credit related commitments arising in respect of the Group's operations were:
Unaudited Unaudited Audited
$000's December 2021 December 2020 June 2021
Letters of credit, guarantee commitments and performance bonds 7,217 6,145 13,484
Total contingent liabilities 7,217 6,145 13,484
Undrawn facilities available to customers 365,623 280,750 299,544
Conditional commitments to fund at future dates 21,646 24,570 19,083
Total commitments 387,269 305,320 318,627

P.38
20 Events after reporting date
The Group declared a fully imputed interim dividend of 5.5 cents per share on 21 February 2022.
There were no other events subsequent to the reporting period which would materially affect the consolidated interim financial
statements.

© 2022 KPMG, a New Zealand Partnership and a member firm of the KPMG global organization of independent member
firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

Independent Review Report
To the shareholders of Heartland Group Holdings Limited
Report on the consolidated interim financial statements of Heartland Group Holdings Limited (the
“Group”)
Conclusion
We have completed a review of the accompanying
consolidated interim financial statements which
comprise:
— the consolidated interim statement of financial
position as at 31 December 2021;
— the consolidated interim statements of
comprehensive income, changes in equity and
cash flows for the 6 month period then ended;
and
— notes, including a summary of significant
accounting policies and other explanatory
information.
Based on our review, nothing has come to our
attention that causes us to believe that the
consolidated interim financial statements on pages
5 to 38 do not:
i. present, in all material respects the
Group’s financial position as at 31
December 2021 and its financial
performance and cash flows for the 6
month period ended on that date; and
ii. comply with NZ IAS 34 Interim Financial
Reporting.

Basis for conclusion
A review of consolidated interim financial statements in accordance with NZ SRE 2410 Review of Financial
Statements Performed by the Independent Auditor of the Entity (“NZ SRE 2410”) is a limited assurance
engagement. The auditor performs procedures, consisting of making enquiries, primarily of persons responsible
for financial and accounting matters, and applying analytical and other review procedures.
As the auditor of Heartland Group Holdings Limited, NZ SRE 2410 requires that we comply with the ethical
requirements relevant to the audit of the annual financial statements.
Our firm has also provided other services to the Group in relation to financial statement audits, regulatory
assurance services, agreed upon procedure engagements and supervisor reporting. Subject to certain
restrictions, partners and employees of our firm may also deal with the Group on normal terms within the
ordinary course of trading activities of the business of the Group. These matters have not impaired our
independence as reviewer of the Group. The firm has no other relationship with, or interest in, the Group.
Use of this Independent Review Report
This report is made solely to the shareholders as a body. Our review work has been undertaken so that we
might state to the shareholders those matters we are required to state to them in the Independent Review
Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the shareholders as a body for our review work, this report, or any of the
opinions we have formed.

Responsibilities of the Directors for the consolidated interim financial
statements
The Directors, on behalf of the Group, are responsible for:
— the preparation and fair presentation of the consolidated interim financial statements in accordance with NZ
IAS 34 Interim Financial Reporting;
— implementing necessary internal control to enable the preparation of consolidated interim financial
statements that is fairly presented and free from material misstatement, whether due to fraud or error; and
— assessing the ability to continue as a going concern. This includes disclosing, as applicable, matters related
to going concern and using the going concern basis of accounting unless they either intend to liquidate or to
cease operations, or have no realistic alternative but to do so.
Auditor’s Responsibilities for the review of the consolidated interim
financial statements
Our responsibility is to express a conclusion on the interim financial statements based on our review. We
conducted our review in accordance with NZ SRE 2410. NZ SRE 2410 requires us to conclude whether anything
has come to our attention that causes us to believe that the interim financial statements are not prepared, in all
The procedures performed in a review are substantially less than those performed in an audit conducted in
accordance with International Standards on Auditing (New Zealand). Accordingly, we do not express an audit
opinion on these consolidated interim financial statements.



KPMG
Auckland
21 February 2022

---

Disclosure

Statement
For the six months

ended 31 December 2021

P.2
Contents
Page
General Information..........................................................................................................................................................................3
Priority of Creditors’ Claims............................................................................................................................................................. 3
Guarantee Arrangements.................................................................................................................................................................3
Auditor............................................................................................................................................................................................... 3
Directors............................................................................................................................................................................................. 3
Directors’ Statements....................................................................................................................................................................... 4
Consolidated Interim Statement of Comprehensive Income......................................................................................................5
Consolidated Interim Statement of Changes in Equity................................................................................................................ 6
Consolidated Interim Statement of Financial Position.................................................................................................................8
Consolidated Interim Statement of Cash Flows.............................................................................................................................9
Notes to the Interim Financial Statements
1 Interim financial statements preparation.......................................................................................................................11
Performance
2 Segmental analysis.............................................................................................................................................................13
3 Net interest income............................................................................................................................................................15
4 Operating expenses...........................................................................................................................................................15
5 Compensation of auditor..................................................................................................................................................15
6 Impaired asset expense.................................................................................................................................................... 16
Financial Position
7 Finance receivables............................................................................................................................................................17
8 Borrowings..........................................................................................................................................................................21
9 Share capital and dividends..............................................................................................................................................22
10 Related party transactions and balances........................................................................................................................23
11 Fair value.............................................................................................................................................................................25
Risk Management
12 Enterprise risk management............................................................................................................................................ 30
13 Credit risk exposure...........................................................................................................................................................30
14 Asset quality....................................................................................................................................................................... 32
15 Liquidity risk........................................................................................................................................................................38
16 Interest rate risk.................................................................................................................................................................40
17 Concentrations of funding.................................................................................................................................................42
Other Disclosures
18 Structured Entities............................................................................................................................................................ 43
19 Capital adequacy.................................................................................................................................................................44
20 Insurance business, securitisation, funds management, other fiduciary activities..................................................50
21 Contingent liabilities and commitments.........................................................................................................................50
22 Events after reporting date...............................................................................................................................................51
Conditions of Registration................................................................................................................................................................52
Credit Ratings..................................................................................................................................................................................... 53
Other Material Matters....................................................................................................................................................................53

P.3
General Information
This Disclosure Statement has been issued by Heartland Bank Limited (the Bank or HBL) and its subsidiaries (the Banking Group)
for the year ended 31 December 2021 in accordance with the Registered Bank Disclosure Statements (New Zealand Incorporated
Registered Banks) Order 2014 (as amended) (the Order). The financial statements of the Bank for the six months ended 31
December 2021 form part of, and should be read in conjunction with, this Disclosure Statement.
Words and phrases defined by the Order have the same meanings when used in this Disclosure Statement.
The Bank's address for service is Level 3, 35 Teed Street, Newmarket, Auckland 1023.
Priority of Creditors’ Claims
In the event of the Bank becoming insolvent or ceasing business, certain claims set out in legislation are paid in priority to others.
These claims include secured creditors, taxes, certain payments to employees and any liquidator’s costs. After payment of those
creditors, the claims of all other creditors are unsecured and would rank equally, with the exception of holders of subordinated
bonds and notes which rank below all other claims.
Guarantee Arrangements
As at the date this Disclosure Statement was signed, no material obligations of the Bank were guaranteed.
Auditor
KPMG
KPMG Centre
18 Viaduct Harbour Avenue
Auckland
Directors
All Directors of the Bank reside in New Zealand. Communications to the Directors can be sent to Heartland Bank Limited, Level 3,
35 Teed Street, Newmarket, Auckland 1023.
There have been no changes in the composition of the Board of Directors of the Bank since 30 June 2021 to the six months ended
31 December 2021.

P.4
Directors’ Statements
Each Director of the Bank states that he or she believes, after due enquiry, that:
1.As at the date on which this Disclosure Statement is signed:
a)the Disclosure Statement contains all the information that is required by the Order; and
b)the Disclosure Statement is not false or misleading.
2.During the six months ended 31 December 2021:
a)the Bank complied with all Conditions of Registration applicable during the period;
b)credit exposures to connected persons were not contrary to the interests of the Banking Group; and
c)the Bank had systems in place to monitor and control adequately material risks of the Banking Group, including
credit risk, concentration of credit risk, interest rate risk, currency risk, equity risk, liquidity risk, operational risk and
other business risks, and that those systems were being properly applied.
This Disclosure Statement is dated 21 February 2022 and has been signed by all the Directors.
B R Irvine (Chair) G T Ricketts
J K Greenslade K Mitchell
E J Harvey S M Ruha

P.5
Consolidated Interim Statement of Comprehensive Income
For the six months ended 31 December 2021
Unaudited
6 Months to
December 2021
Unaudited
6 Months to
December 2020
Audited
12 Months to
June 2021
$000's Note
Interest income
3
132,072 139,875 272,562
Interest expense
3
28,057 43,642 73,753
Net interest income 104,015 96,233 198,809
Operating lease income 2,588 2,579 5,004
Operating lease expense 1,545 1,598 3,149
Net operating lease income 1,043 981 1,855
Lending and credit fee income 3,416 3,224 6,455
Other income 3,967 3,309 6,696
Net operating income 112,441 103,747 213,815
Operating expenses
4
48,154 53,256 100,852
Profit before impaired asset expense and income tax 64,287 50,491 112,963
Fair value (loss)/gain on investments (315) - 215
Impaired asset expense
6
8,540 4,538 14,579
Profit before income tax 55,432 45,953 98,599
Income tax expense 14,449 12,939 27,090
Profit for the period 40,983 33,014 71,509
Other comprehensive income
Items that are or may be reclassified subsequently to profit or
loss, net of income tax:
Effective portion of change in fair value of derivative financial
instruments
6,619 4,580 8,928
Movement in fair value reserve (6,356) (1,038) (5,646)
Other comprehensive income for the period, net of income tax 263 3,542 3,282
Total comprehensive income for the period 41,246 36,556 74,791
Total comprehensive income for the period is attributable to the owner of the Bank.
The notes to the interim financial statements form an integral part of, and should be read in conjunction with, these
consolidated interim financial statements.

P.6
Consolidated Interim Statement of Changes in Equity
For the six months ended 31 December 2021
Share
Capital
Fair
Value
Reserve
Defined
Benefit
Reserve
Cash Flow
Hedge
Reserve
Retained
Earnings Total Equity $000's Note
Unaudited - December 2021
Balance as at 1 July 2021 553,239 (322)171906 87,834 641,828
Total comprehensive
income for the period
Profit for the period - - - - 40,983 40,983
Other comprehensive (loss)/
income, net of income tax
-(6,356) -6,619-263
Total comprehensive (loss)/
income for the period
-(6,356)-6,61940,983 41,246
Contributions by and distributions to
owner
Dividend to Heartland Group Holdings
Limited
9 - - - - - -
Total transactions with owner - - - - - -
Balance as at 31 December 2021 553,239 (6,678) 171 7,525 128,817 683,074
Unaudited - December 2020
Balance as at 1 July 2020 553,239 5,324 171 (8,022) 46,325 597,037
Total comprehensive
income for the period
Profit for the period - - - - 33,014 33,014
Other comprehensive (loss)/
income, net of income tax
-(1,038) -4,580-3,542
Total comprehensive (loss)/
income for the period
-(1,038)-4,58033,014 36,556
Contributions by and distributions to
owner
Dividend to Heartland Group Holdings
Limited
9 - - - - - -
Total transactions with owner - - - - - -
Balance as at 31 December 2020 553,239 4,286 171 (3,442) 79,339 633,593
The notes to the interim financial statements form an integral part of, and should be read in conjunction with, these
consolidated interim financial statements.

P. 7
Consolidated Interim Statement of Changes in Equity (Continued)

For the six months ended 31 December 2021




Share
Capital
Fair
Value
Reserve
Defined
Benefit
Reserve
Cash Flow
Hedge
Reserve
Retained
Earnings Total Equity




$000's Note
Audited - June 2021




Balance as at 1 July 2020 553,239 5,324 171 (8,022) 46,325 597,037
Total comprehensive
income for the year


Profit for the year - - - - 71,509 71,509
Other comprehensive (loss)/
income, net of income tax
- (5,646) - 8,928 - 3,282
Total comprehensive (loss)/
income for the year

- (5,646) - 8,928 71,509 74,791


Contributions by and distributions to
owner


Dividend to Heartland Group Holdings
Limited
9 - - - - (30,000) (30,000)
Total transactions with owner - - - - (30,000) (30,000)
Balance as at 30 June 2021

553,239 (322) 171 906 87,834 641,828

The notes to the interim financial statements form an integral part of, and should be read in conjunction with, these
consolidated interim financial statements.

P. 8
Consolidated Interim Statement of Financial Position


As at 31 December 2021






Unaudited
December 2021
Unaudited
December 2020
Audited
June 2021
$000's
Note
Assets
Cash and cash equivalents 137,937 104,965 112,903
Investments 297,316 451,159 358,975
Investment properties 11,832 11,132 11,832
Derivative financial instruments 21,540 15,023 14,111
Due from related parties 10 1,345 259 146
Finance receivables 7 3,470,003 3,042,378 3,213,593
Finance receivables - reverse mortgages 7 648,865 622,137 601,505
Operating lease vehicles 13,009 12,712 10,865
Right of use assets 14,609 16,779 15,654
Other assets 14,536 14,257 14,822
Intangible assets 57,353 52,181 52,831
Deferred tax asset 14,595 14,890 12,251
Total assets 4,702,940 4,357,872 4,419,488

Liabilities
Retail deposits 8 3,336,509 3,271,109 3,219,522
Other borrowings 8 622,336 389,589 502,885
Due to related parties 10 688 9,399 3,210
Lease liabilities 16,703 18,878 17,780
Tax liabilities 6,211 5,341 7,556
Derivative financial instruments 3,400 12,390 4,789
Trade and other payables 34,019 17,573 21,918
Total liabilities 4,019,866 3,724,279 3,777,660

Equity
Share capital 9 553,239 553,239 553,239
Retained earnings and other reserves 129,835 80,354 88,589
Total equity 683,074 633,593 641,828

Total equity and liabilities 4,702,940 4,357,872 4,419,488


Total interest earning and discount bearing assets 4,481,311 4,204,727 4,215,116
Total interest and discount bearing liabilities 3,942,304 3,641,406 3,704,130

The notes to the interim financial statements form an integral part of, and should be read in conjunction with, these
consolidated interim financial statements.

P. 9
Consolidated Interim Statement of Cash Flows

For the six months ended 31 December 2021




Unaudited
6 Months to
December 2021
Unaudited
6 Months to
December 2020
Audited
12 Months to
June 2021


$000's
Note
Cash flows from operating activities
Interest received 113,807 122,874 236,081
Operating lease income received 1,807 1,480 5,046
Lending, credit fees and other income received 4,881 6,914 8,431
Operating inflows 120,495 131,268 249,558

Interest paid (36,697) (46,659) (88,635)
Payments to suppliers and employees (30,021) (48,024) (86,261)
Taxation paid (18,283) (19,759) (27,518)
Operating outflows (85,001) (114,442) (202,414)

Net cash flows from operating activities before changes in
operating assets and liabilities
35,494 16,826 47,144

Proceeds from sale of operating lease vehicles 3,023 5,584 6,821
Purchase of operating lease vehicles (6,016) (1,594) (1,788)
Net movement in finance receivables (292,843) 3,840 (136,202)
Net movement in deposits 117,139 5,071 (43,587)
Net movement in related party balances (3,721) 2,677 (3,399)

Net cash flows (applied to)/from operating activities
1
(146,924) 32,404 (131,011)

Cash flows from investing activities
Purchase of property, plant and equipment and intangible assets (7,676) (3,954) (6,520)
Net decrease/(increase) in investments 54,988 (62,876) 24,215
Total cash from/(applied to) investing activities 47,312 (66,830) 17,695

Net cash flows from/(applied to) investing activities 47,312 (66,830) 17,695

Cash flows from financing activities
Net increase in wholesale funding 125,740 34,219 152,783
Total cash provided from financing activities 125,740 34,219 152,783

Dividends paid 9 - - (30,000)
Payment of lease liabilities (1,094) (291) (2,027)
Total cash (applied to) financing activities (1,094) (291) (32,027)

Net cash flows from financing activities 124,646 33,928 120,756

Net increase in cash held 25,034 (498) 7,440
Opening cash and cash equivalents 112,903 105,463 105,463
Closing cash and cash equivalents 137,937 104,965 112,903
1
Cash flows from operating activities do not include cash flows from wholesale funding which are included as part of financing activities.

The notes to the interim financial statements form an integral part of, and should be read in conjunction with, these
consolidated interim financial statements.

P. 10
Consolidated Interim Statement of Cash Flows (Continued)


For the six months ended 31 December 2021



Reconciliation of profit after tax to net cash flows from operating activities






Unaudited
6 Months to
December 2021
Unaudited
6 Months to
December 2020
Audited
12 Months to
June 2021


$000's
Note
Profit for the period 40,983 33,014 71,509

Add / (less) non-cash items:
Depreciation and amortisation expense 5,429 9,311 14,293
Depreciation on lease vehicles 1,429 1,436 2,801
Capitalised net interest income and fee income (19,149) (18,481) (34,555)
Impaired asset expense 6 8,540 4,538 14,579
Investment fair value movement 315 - (215)
Other non-cash items (8,242) (7,205) (23,210)
Total non-cash items (11,678) (10,401) (26,307)

Add / (less) movements in operating assets and liabilities:
Finance receivables (292,843) 3,840 (136,202)
Operating lease vehicles (2,993) 3,990 5,033
Other assets (2,126) 2,914 2,884
Current tax (1,345) (5,930) (3,715)
Derivative financial instruments (2,199) 2,219 (122)
Deferred tax (2,344) 437 3,076
Deposits 117,139 5,071 (43,587)
Other liabilities 10,482 (2,750) (3,580)
Total movements in operating assets and liabilities (176,229) 9,791 (176,213)


Net cash flows applied to operating activities
1
(146,924) 32,404 (131,011)
1
Cash flows from operating activities do not include cash flows from wholesale funding which are included as part of financing activities.

The notes to the interim financial statements form an integral part of, and should be read in conjunction with, these
consolidated interim financial statements.

P. 11
Notes to the Interim Financial Statements

For the six months ended 31 December 2021

1 Interim financial statements preparation

Basis of preparation

The interim financial statements presented are the consolidated interim financial statements comprising Heartland Bank Limited
(the Bank or HBL) and its subsidiaries (the Banking Group). They have been prepared in accordance with Generally Accepted
Accounting Practices in New Zealand (NZ GAAP) as defined in the Financial Reporting Act 2013. These consolidated interim
financial statements comply with NZ IAS 34 Interim Financial Reporting as appropriate for publicly accountable for-profit entities
and NZ IAS 34 Interim Financial Reporting.

The Disclosure Statement does not include all notes of the type normally included in an annual financial report. Accordingly this
report is to be read in conjunction with the Disclosure Statement for the year ended 30 June 2021 and any public announcements
made by the Bank during the interim reporting period.

The consolidated interim financial statements presented here are for the following periods:

• 6 month period ended 31 December 2021 – Unaudited
• 6 month period ended 31 December 2020 – Unaudited
• 12 month period ended 30 June 2021 – Audited

The consolidated interim financial statements have been prepared on a going concern and historical cost basis, unless stated
otherwise. The accounting policies adopted are consistent with those of the previous financial year and corresponding interim
reporting period.

Certain comparative balances have been reclassified to align with the presentation used in the current financial year. These
reclassifications have no impact on the overall financial performance or financial position for the comparative year.

Change in accounting policy

There have been no changes to accounting policies or new or amended standards that are issued and effective that are expected
to have a material impact on the Banking Group.

Accounting standards issued not yet effective

The final version of NZ IFRS 17 Insurance Contracts was issued in August 2017 and is applicable to general and life insurance
contracts. The standard will be effective for the Banking Group’s reporting for the financial year ending 30 June 2024, including 30
June 2023 comparatives.

MARAC Insurance Limited (MIL), a subsidiary of HBL, ceased writing insurance policies in 2020 with the periodic policies expected
to expire in 2025.

Other amendments to existing standards that are not yet effective are not expected to have a material impact on the Banking
Group.

P. 12
1 Interim financial statements preparation (continued)

Estimates and judgements

There have been no material changes to the use of estimates and judgements for the preparation of the interim financial
statements since the reporting date of the previous financial statements. The Banking Group’s Disclosure Statement for the year
ended 30 June 2021 contain detail on the estimates and judgements used.

Covid-19 pandemic - impact on estimates and judgements

The COVID-19 pandemic resulted in the Banking Group adopting an economic overlay for expected credit losses (ECL) to its
portfolios as at 30 June 2020 of pre-tax $9.6 million in response to the uncertain but potential economic impact of COVID-19 on
HBL's borrowers (COVID Overlay). The COVID Overlay was sized based on a range of techniques including stress testing,
benchmarking, scenario analysis and expert judgement.

To date, the impact of COVID-19 on HBL's borrowers has been more benign than was initially forecast, and the COVID Overlay has
not been utilised. However, the continued prevalence of COVID-19 and other countries (including the emergence of new
variants), together with vaccination rates and border closures provides an ongoing risk of further economic disruption in New
Zealand. This may impact borrowers with the potential for further inflationary pressures, increased interest rates and
expected higher employment costs resulting from a restricted supply of labour.

With the uncertainties associated to the ongoing economic impacts of COVID-19, the COVID Overlay has been retained in full at
this stage.

The accounting judgement that is most impacted by the COVID Overlay is the ECL on finance receivables at amortised cost. The
Banking Group measures the allowance for ECL using an impairment model in compliance with NZ IFRS 9 Financial Instruments.

P. 13
Performance

2 Segmental analysis

Segment information is presented in respect of the Banking Group's operating segments which are those used for the Banking
Group's management and internal reporting structure.

Operating segments

The Banking Group operates within New Zealand and comprises the following main operating segments:

Motor Motor vehicle finance.

Reverse mortgages Reverse mortgage lending in New Zealand.

Personal Lending Transactional, home loans and personal loans to individuals.

Business Term debt, plant and equipment finance, commercial mortgage lending and working capital solutions for
small-to-medium sized businesses.

Rural Specialist financial services to the farming sector primarily offering livestock finance, rural mortgage
lending, seasonal and working capital financing, as well as leasing solutions to farmers.

Certain operating expenses, such as premises, IT and support centre costs are not allocated to operating segments and are
included in Other. Liabilities are managed centrally and therefore are not allocated across the operating segments.

The Banking Group's operating segments are different from the industry categories detailed in Note 13 - Credit risk exposure. The
operating segments are primarily categorised by sales channel, whereas Note 13 - Credit risk exposure categorises exposures
based on credit risk concentrations.


Reverse Personal
$000's
Motor Mortgages Lending Business Rural Other Total
Unaudited - December 2021

Net interest income 34,687 14,000 4,496 35,888 15,138 (195) 104,015
Net other income 1,703 1,289 726 1,408 365 2,936 8,426
Net operating income 36,390 15,289 5,222 37,296 15,503 2,741 112,441

Operating expenses 1,975 2,354 3,268 4,756 1,531 34,270 48,154
Profit/(loss) before impaired asset expense
and income tax
34,415 12,935 1,954 32,540 13,972 (31,529) 64,287



Fair value (loss) on investment - - - - - (315) (315)
Impaired asset expense 2,518 - 902 4,210 909 1 8,540
Profit/(loss) before income tax 31,897 12,935 1,052 28,330 13,063 (31,845) 55,432

Income tax expense - - - - - 14,449 14,449
Profit/(loss) for the period 31,897 12,935 1,052 28,330 13,063 (46,294) 40,983

Total assets 1,344,865 648,865 272,803 1,294,601 583,026 558,780 4,702,940
Total liabilities 4,019,866

P. 14
2 Segmental analysis (continued)


Reverse Personal
$000's
Motor Mortgages Lending Business Rural Other Total
Unaudited - December 2020

Net interest income
31,255 10,175 7,625 31,659 15,071 448 96,233
Net other income
1,717 1,018 1,137 1,343 460 1,839 7,514
Net operating income 32,972 11,193 8,762 33,002 15,531 2,287 103,747


Operating expenses
1,843 1,986 3,151 5,896 1,172 39,208 53,256
Profit/(loss) before impaired asset expense
and income tax
31,129 9,207 5,611 27,106 14,359 (36,921) 50,491


Fair value gain on investments
- - - - - - -
Impaired asset expense/(benefit)
2,266 - (793) 2,674 391 - 4,538
Profit/(loss) before income tax 28,863 9,207 6,404 24,432 13,968 (36,921) 45,953


Income tax expense
- - - - - 12,939 12,939
Profit/(loss) for the period 28,863 9,207 6,404 24,432 13,968 (49,860) 33,014

Total assets 1,200,349 576,579 163,519 1,133,767 569,676 713,982 4,357,872
Total liabilities 3,724,279

Audited - June 2021

Net interest income
65,829 23,098 13,648 66,112 30,579 (457) 198,809
Net other income
3,343 2,369 2,767 2,963 1,581 1,983 15,006
Net operating income 69,172 25,467 16,415 69,075 32,160 1,526 213,815


Operating expenses
3,787 4,397 6,241 11,340 2,124 72,963 100,852
Profit/(loss) before impaired asset expense
and income tax
65,385 21,070 10,174 57,735 30,036 (71,437) 112,963


Fair value gain on investments
- - - - - 215 215
Impaired asset expense
5,298 - 1,977 5,655 1,649 - 14,579
Profit/(loss) before income tax 60,087 21,070 8,197 52,080 28,387 (71,222) 98,599


Income tax expense
- - - - - 27,090 27,090
Profit/(loss) for the year 60,087 21,070 8,197 52,080 28,387 (98,312) 71,509

Total assets 1,287,978 601,505 137,910 1,225,710 586,318 580,067 4,419,488
Total liabilities 3,777,660