Bendigo and Adelaide Bank's vision of being Australia’s bank of choice is bolstered by solid interim results
Bendigo and Adelaide Bank continue to make their mark after posting strong interim results for the half year ending 31 December 2019.
Australia’s fifth-largest retail bank has set its sights on being the nation’s bank of choice, and their recent interim figures indicate their vision isn’t impractical.
They saw an uptick in total income on a cash basis, Common Equity Tier 1, total lending, residential lending and total deposits.
“Our interim results, underpinned by our market leading trust ratings, strong growth, above system lending, margin management, asset quality and growth in new and existing markets, affirm our multi-year strategy to be Australia’s bank of choice, Managing director and chief executive officer Marnie Baker said.
“Earnings for the half were impacted by ongoing technology investment, regulatory and compliance costs and staff investment to support mortgage growth.
“Despite this, we delivered total income of $814.7 million, up 1.4% on the prior corresponding period, in a challenging environment comprised of low rates, increasing regulatory pressure, low consumer and business confidence and growing competition.
“Strong customer growth continued with the total number of customers choosing our Bank increasing 4.9% in the half. This sustained growth set a record of more than 1.8 million customers. Our net promotor score is 27.2 higher than the average of the major banks.”
Their recent results signify that the Bendigo and Adelaide Bank are delivering on their key metrics, which is something Baker is extremely encouraged by.
“We are seeing positive momentum from the implementation of our strategy one year into our multi-year journey,” she said.
By reducing complexity and increasing our capability to achieve sustainable growth, a seamless customer experience and a lower cost base, we saw continued performance in our key priority markets.
Baker said total lending continued to grow to $62.9 billion, up 2.8% on the prior corresponding period and above system.
“In the half, residential lending was well above system at 7.7%, reflecting strong customer demand driven by strategic focus in our retail and third-party businesses,” she said.
“Agribusiness lending was down 6.8%, influenced by seasonality and the ongoing multi-year drought. Rural Bank continued to diversify its earnings with growth in its Government Services business delivering revenue uplift.
“For small business customers, focused relationship banking strategies delivered growth and margin improvement, with small business lending up 15.6%.”
Additionally, Baker said their Consumer Banking division performed strongly, driven by investment in processing capacity, to support settlement growth, new mobile relationship and business development managers and new and enhanced third party white label partnerships.
“Lending applications increased 45% and settlements 35% on the prior half,” she said
“Net interest margin increased 2 basis points on the prior corresponding period to 2.37%, reflecting the active management of margin and volume for lending and deposits.
“Our ongoing focus on credit quality is reflected in our bad and doubtful debts, down 9% to $23.2 million.
“All business divisions are well secured, and portfolio performance remains sound.”
