Powered by MOMENTUM MEDIA
Powered by MOMENTUM MEDIA
subscribe to our newsletter

Bank boss hungry for more market share

Bendigo and Adelaide Bank’s managing director says the group’s balance sheet is “very strong” and it is well-placed to compete “vigorously” for customers.

In a statement to shareholders, Mike Hirst revealed that the regional bank posted a $208.7 million profit after tax for the six months to 31 December 2015, with $223.7 million worth of cash earnings – a 2.7 per cent increase on the prior corresponding period.

Mr Hirst said that while Bendigo and Adelaide Bank’s net interest margin contracted slightly on the prior half-year by 1 basis point to 2.16 per cent, the repricing of the mortgage market “to more realistic levels” has seen its margin improve in the latter part of the calendar year.

Advertisement
Advertisement

Furthermore, Mr Hirst said the low interest rate environment continued to impact the bank’s growth as many customers chose to reduce debt.

“About 43 per cent of our customers are ahead in their loan repayments, while mortgage offset accounts grew by 12 per cent over the period,” he said.

“All of this means that our bank is in a very strong position from a balance sheet perspective and particularly well-placed to compete vigorously for customers in the future.

“With our Basel III Common Equity Tier 1 ratio increasing 7 basis points to 8.24 per cent and total capital increasing 9 basis points to 12.66 per cent, we have ample capital to grow our business.”

Mr Hirst said funding is a particular strength for Bendigo and Adelaide Bank, with approximately 81 per cent of its funding provided through deposits.

“As the wholesale markets move through a period of volatility and higher prices, our funding profile provides some insulation from those issues,” he said.

“We have continued to build and position a strong and valued brand, and our steadfast approach to disciplined margin management and balance sheet growth means our bank is well-placed for sustainable growth.”

[Related: Bank boss calls out ‘irrational’ mortgage pricing]

Bank boss hungry for more market share
mortgagebusiness

Latest News

The corporate regulator has proposed to use its product intervention powers to address “significant detriment” caused by continuing cre...

The federal government’s fund manager has paused investment rounds on the $2-billion Australian Business Securitisation Fund in light of c...

The banking sector’s commitment to extend loan repayment holidays for distressed borrowers could prolong the deterioration in credit quali...

FROM THE WEB
podcast

LATEST PODCAST: Support for current broker remuneration model

Do you expect COVID-19 to reduce or increase your business flows?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.