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Highlights

  • Bendigo Bank reported FY25 cash earnings of AUD 514.6 million, down 8.4% year-on-year, with statutory earnings falling 118% due to goodwill impairment.

  • Lending and deposits increased by 7.6% and 6.6% respectively, while the final dividend was maintained at 33 cents per share.

  • The bank reaffirmed its 2030 strategy, targeting a return on equity above 10% and focusing on digital, efficiency, and customer growth.

Bendigo and Adelaide Bank Ltd (ASX:BEN) released its financial results for the year ended 30 June 2025 (FY25), reporting lower earnings as competitive conditions weighed on margins and profitability.

The bank’s shares were trading at AUD 13.03 in morning trade on Monday, up 0.3% from Friday’s close of AUD 12.99. For comparison, the S&P/ASX 200 Index (ASX: XJO) was up 0.9% at the same time.

Financial Performance

Bendigo Bank posted cash earnings after tax of AUD 514.6 million, down 8.4% year-on-year. Statutory earnings after tax fell sharply to AUD 97.1 million, representing a 118% decline from FY24. The result was impacted by a significant goodwill impairment.

The bank’s cash return on equity (ROE) was reported at 7.34%, down from 8.18% in FY24. Net interest margin (NIM) edged slightly lower by 0.02% to 1.88%. The Common Equity Tier 1 (CET1) ratio ended the period at 11.00%, 0.32% lower than the previous year.

Total operating expenses rose 7.7% for the year, while gross impaired loans declined 4.5% to AUD 129.5 million, or 0.15% of gross loans.

Growth and Dividends

Despite earnings pressure, Bendigo Bank reported growth in both lending and deposits. The residential lending book increased 7.6% year-on-year to AUD 66.6 billion, while customer deposits grew 6.6% to AUD 72.9 billion.

The board declared a fully franked final dividend of 33 cents per share, unchanged from FY24. Shares will trade ex-dividend on 2 September, with payment available to shareholders on record at market close on 1 September.

Management Commentary

Commenting on the results, CEO Richard Fennell said that the performance in the second half of FY25 compared with the first half, noting that demand-driven margin pressure had eased. Operating expenses were higher overall due to investment spending, but business-as-usual costs excluding investment were reported to be well below inflation in the second half.

Strategic Outlook

Looking ahead, the bank reaffirmed its 2030 strategy, which focuses on five pillars: enhancing digital services, operating efficiently, deepening customer relationships, setting benchmarks in trust and societal impact, and reinventing banking for the next generation through its Up brand.

Bendigo Bank is targeting a return on equity above 10% by 2030. 

With Monday’s modest intraday gains factored in, Bendigo Bank shares have risen 6% over the past year, excluding dividends.