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Highlights

  • Banks of Queensland offers diverse commercial banking, retail banking, insurance and wealth management services through a network of over 160 branches
  • During the first half of 2023, statutory net profit after tax decreased by 98% YoY
  • The Australian bank is focused on its digitisation strategy and simplification of banking operations

Australian regional bank, Bank of Queensland (ASX: BOQ) offers a diverse range of commercial banking, retail banking, wealth management and insurance services through more than 160 branches across Australia. The bank manages brands like ME Bank, BOQ Specialist, BOQ Finance, and Virgin Money Australia.

BOQ’s Tier 1 capital ratio improved by 114bps in  the first half of 2023 over the previous corresponding period. CET1 improved due to the implementation of Basel III. During the reported period, statutory net profit after tax dropped by 98% YoY to AUD 4 million because of the provision for the integrated risk program and goodwill impairment. However, the net interest income increased by 12.3% to AUD 832 million in 1HFY23.

Top 10 shareholders of BOQ

The top 10 shareholders of BOQ together hold around 16.62% stake in the company, and the top four shareholders together have 11.56% stake. The Vanguard Group, Inc. and State Street Global Advisors Australia Ltd. have the maximum stake in BOQ, with holdings of around 4.93% and 3.51%, respectively.

Recent business update

In the last significant update, dated 25 July 2023, BOQ released the APRA Basel III Pillar 3 report for the quarter ending 31 May 2023. At the end of the quarter, the company’s common equity tier 1 capital ratio was 10.76%, compared to 10.71% in the previous quarter. Tier 1 capital ratio was 13.44% in the stated quarter, compared to 13.42% in the last quarter, and the total capital ratio was 15.38%, compared to 15.89% in the previous quarter.

Through the ASX filing, the bank also shared that it had redeemed AUD 200 million in subordinate debt in May 2023.

Outlook

BOQ is focused on advancing its multi-year integrated risk program, which will improve risk culture and uplift operational resilience. The bank is undertaking a business simplification program and progressing with its digitisation strategy.

The bank expects to register a CET1 ratio in the range of 10.25% - 10.75% during the financial year 2023. The targeted dividend payout ratio range is 60-75% of cash earnings.

Share performance of BOQ

Shares of BOQ closed 0.67% higher at AUD 5.990 apiece on 10 August 2023. Including today’s gain, BOQ share price dropped by 20.45% in the last 12 months and increased by 7.35% in the last one month.

The 52-week high of BOQ is AUD 7.79 apiece, recorded on 14 October 2022. The 52-week low is AUD 5.32 apiece, recorded on 26 January 2023. The 52-week low of BOQ is only 12.59%, far from its existing stock price.

Note 1: Past performance is neither an Indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, currency, is 10 August 2023. The reference data in this report has been partly sourced from REFINITIV.