Heartland New Zealand reported a 71% drop in annual net profit to nearly $7 million - in line with its guidance.
That reflects its decision to book an upfront cost in order to put the legacy of its unwanted and troubled property portfolio behind it.
Operating profit for the company before those costs was up nearly 24% to $37 million for the 12 months to the end of June.
Heartland, which became a bank in December last year, says the underlying profit growth reflects growth of its core assets and a continuing lower cost of funds.
Net operating income rose across its business, rural and consumer lending operations, the bank says.
Heartland concentrates on lending to middle New Zealand, providing working capital to businesses and funding equipment purchases, livestock and seasonal finance to the rural sector and lending to consumers for such purchases as motor vehicles.