Bendigo and Adelaide Bank half-year cash earnings soar by 10.9%
Australia’s fifth largest bank, Bendigo and Adelaide Bank is gaining traction on the Big Four banks in Australia, announcing a significant after-tax statutory profit of $227.3 million and an underlying cash earnings profit of $217.9 million, for the six months ending 31 December 2014. This equates to a 10.9% increase on the prior half year result.
However, when you consider the Commonwealth Bank posted an after-tax statutory profit of $4,535 million for the same period and is set to become the first Australian bank to post a near $10 billion annual profit, Bendigo and Adelaide Bank still have some catching up to do.
Bendigo and Adelaide Bank managing director Mike Hirst said this was a solid result given the highly competitive, low-growth environment in which the Bank is operating.
Hirst explained while demand for housing loans was solid, the bank had seen an increase in customers paying down their debt across all portfolios, which impacted the Bank's growth. However said this was “fantastic” for customers as they're building equity and greater financial wealth, particularly as interest rates have fallen.
"Despite this environment, we’ve strengthened our balance sheet with a strong Basel III compliant liquidity position, while our capital raising activities have been well-supported by institutional and retail investors."
Bendigo and Adelaide Bank announced a number of innovative technologies during the year and Hirst explained that this was helped by partnering with specialist companies to provide solutions that customers are asking for.
Hirst also said Bendigo and Adelaide Bank’s acquisition of Rural Finance and growth of Rural Bank helped give the bank a strong position in the agri-business banking market right across the nation.
"We’ve also established a banking model that will enable participating mutuals to position themselves for growth in this challenging environment while remaining true to their traditional ideals and values,” said Hirst.