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Bendigo Bank Lifts Profits

Bendigo Bank Lifts Profits
Aug 10, 2015 By Ben Visser

Bendigo and Adelaide Bank Ltd (ASX:BEN) has reported its full year financial results ending 30 June 2015. The company reported a lift in cash earnings of 13.1 per cent.

Bendigo and Adelaide Bank Ltd is Australia’s fifth largest retail bank and offers a broad range of banking and other financial services. Under the Bendigo and Adelaide bank umbrella the business operates under four distinct brands and offers retail and wholesale banking, wealth management services, business and commercial lending, payments services, foreign exchange and superannuation. The company has assets under management of more than $52bn.

BEN reported an after tax statutory profit of $423.9 million for the 12 months ending 30 June 2015. Underlying cash earnings were $432.4 million, up 13.1 per cent and cash earnings per share were $0.951, up 3.9 per cent when compared to the previous corresponding period.

The bank will pay a final fully franked dividend of 33 cents per share in September, bringing the full-year dividend to 66 cents, up 2 cents compared to last year.

Managing Director, Mike Hurst commented, “Net interest margin experienced a slight contraction of 4bps reflecting the highly competitive, low interest rate environment in which the bank continues to operate. Having to operate on an uneven playing field impacted mortgage growth and this was compounded by repayment of debt by customers. However, it’s great to see our customer’s building equity and improving their financial wealth by taking advantage of the current low interest rate environment. Pleasingly, the recent APRA announcement regarding changes to risk weights on mortgages is a positive step toward levelling the playing field and a good outcome for customers seeking greater choice in banking service providers.”

Following this morning’s promising financial results, Bendigo’s share price has experienced a decline of 4 per cent in the first hour of trading. This is more likely due to the market wide sell-off in the retail banking industry and less likely an indication of investor sentiment toward Bendigo’s financial results.

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Ben Visser Author: Ben Visser Aug 10, 2015

Ben is a Wise-owl equity analyst focusing on ASX blue-chips stocks. Ben has a Bachelor of Business in Finance majoring in property valuations and management. In his role at Wise-owl Ben conducts in-depth fundamental and technical analysis which helps him to find profitable investment opportunities on the ASX and abroad.

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