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The SME-focused lender said its gross loans and advances (GLA) reached $13.8 billion as at 31 March 2026, up from $13.4 billion at the end of December 2025, supported by strong origination volumes and improved customer retention.
Net interest margin (NIM) for the quarter rose to approximately 3.15 per cent, compared with 3.03 per cent in the first half, in line with the bank’s guidance for the second half of FY26. Lending margins remained firm at 4.2 per cent, with new lending also written at similar levels.
CEO Chris Bayliss said the bank continued to support SME customers amid a more volatile operating environment.
“Judo continues to give its full support to Australian small and medium-sized enterprises as they navigate heightened volatility in the operating environment. Our unique relationship-led approach and low ratio of customers to bankers means we are close to our customers, and we are well positioned to understand and support their individual lending needs,” Bayliss said.
“Given the changes in the macro environment, our experienced relationship bankers have completed a customer-by-customer assessment of the portfolio. Our customers continue to demonstrate resilience, and our asset quality remains stable.
“While our customer base remains in good financial health, we have prudently chosen to strengthen our forward-looking collective provision in recognition of ongoing uncertainty for the outlook.
“Notwithstanding the provision increase, we are still on track to deliver FY26 profit before tax within our original guidance range, albeit towards the lower end. This continues to represent significant operating leverage, underpinned by strong lending, favourable funding conditions and disciplined cost management, and demonstrates strong progress towards our at-scale target of low-to-mid teens ROE.”
The bank reaffirmed its FY26 profit before tax guidance of $180–$190 million, though it now expects to land toward the lower end of the range following a top-up to its collective provisions.
Deposits increased to $11.5 billion during the quarter, supported by the continued rollout of new savings products, including the Direct Online Savings Account launched in February 2026. Combined balances across its new at-call products have exceeded $1.1 billion.
Asset quality remained stable, with 90-day past-due and impaired loans at 2.65 per cent of GLA, slightly improved from 2.66 per cent in December.
Despite this, the bank increased its provisioning overlay to account for heightened geopolitical uncertainty and sector-specific risks, particularly in industries such as agriculture, construction, retail, manufacturing, and transport.
Looking ahead, the bank maintained its expectation of continued lending growth, with FY26 GLA guidance in the range of $14.4–$14.7 billion, alongside NIM at the upper end of its 3.00–3.10 per cent target range.
[Related: Judo Bank keeps growth on track as loan book expands]
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