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Suncorp chief executive Steve Johnston expects the economy to stage a firm recovery from the current lockdown-induced slump by the end of this year, as the insurance giant rewarded investors with a $250 million share buyback and special dividend.
As Suncorp beat market expectations for its full-year profits and dividends on Monday, Mr Johnston delivered an optimistic outlook, tipping a V-shaped economic recovery.
Suncorp CEO Steve Johnston says the company is confident lockdowns will be much less common by the end of the year.Credit:Attila Csaszar
Mr Johnston said there was no question the lockdown in NSW would drag on national growth, but assuming vaccines were rolled out as expected, there should be a solid rebound in growth by the end of the year.
“If the government can get the vaccine rollout going at the forecast rate that they’re suggesting that gives us confidence towards the end of the calendar year, lockdowns won’t be in place to anywhere near the degree they are today and the economy will open up,” Mr Johnston said in an interview.
Citing the economic pattern witnessed last year, and the alphabet-derived names used to describe the recovery, he argued it was fair to assume the economy would bounce back strongly once again.
“We did see the economy bounce back. We were all wondering what sort of recovery it would be –J curve, all sorts of Ws – and it was more a V-shaped recovery. And so, I have no reason to believe that that’s not going to be the case again, or that the government won’t stand behind the economy, as they are.”
National Australia Bank chief executive Ross McEwan also said economies generally bounced back strongly from lockdowns on Monday, though he said two quarters in a row of negative growth – a recession – was also possible.
“We’ve got the large states now in some form of lockdown, it doesn’t look like it’s going to be lifted for a little while yet with the numbers,” Mr McEwan said.
“What we’ve seen is when the big states go into lockdown and consumer confidence drops, as it is at the moment, we may well be back into another two-quarter negative, giving us a recession. But the point, as we saw last time, is the bounce-back is usually very, very quick,” Mr McEwan said.