Bank of Queensland Ltd

Net interest income rose YoY: Bank of Queensland Ltd (ASX: BOQ) ended the FY 2018 with the net interest income of $965 million which reflects the YoY growth of 4%. The reasons for the YoY growth in the net interest income was the NIM or net interest margin improvement and higher interest earning assets. The margin was improved mainly due to the favorable funding charges.

Moreover, the bank carries out its operations via three segments i.e., BOQ business, Retail banking as well as other. The bank’s total income amounted to $1.11 billion in FY 2018 with its BOQ business segment being the largest contributor with the total income of $573 million. However, retail banking division and other have garnered total income of $525 million and $12 million, respectively.

What Could Improve Bank of Queensland’s Performance Moving Forward? The management of Bank of Queensland is optimistic about the New Payments Platform or NPP. As a result of this platform, the real-time payments would be made possible. With the help of NPP, improvement in regard to the payment’s visibility can be achieved. However, other benefits would include liquidity as well as the management of cash. Its financial market digital platform would hit the market in the next year which could further improve the bank’s product offerings as foreign exchange hedging as well as international payments would be enabled by the platform.

FY18 Financial Performance (Source: Company Reports)

Meanwhile, a technical momentum indicator, Moving Average Convergence Divergence or MACD, has been applied on the monthly chart of Bank of Queensland. As per the observation, a bullish crossover might be witnessed moving forward. As a result, we maintain our “hold” rating on the stock at the current market price of A$10.790. 
 

MyState Ltd

FY 2018 performance helped by digitization: MyState Ltd.’s (ASX: MYS) performance was positively impacted by the performance drivers as well as several primary financial metrics. The increasing trend towards the digital channels have also helped MyState in FY 2018 as adoption levels by the customers have witnessed a rise.

MyState’s total operating income in FY 2018 amounted to $126.3 million which implies the YoY growth of 1.4%. Of the total operating income, the highest portion has been garnered from the banking segment i.e. $107.7 million. However, the wealth management segment saw a total operating income of $18.7 million. On the other hand, corporate and consolidation segment recorded total operating loss amounting to $0.16 million in FY 2018.

 

MyState’s Funds under management and Funds under advice (Source: Company Reports)

What MyState Has in Mind Moving Forward? MyState plans to improve the customer experience which could help it to become the customers’ preferred option. It has been working to further improve its platforms by leveraging the digital capabilities which could help in bringing the customers onboard at a rapid pace. MyState is also working to come up with the CRM capabilities as well as marketing analytics. Thus, working from the viewpoint of the customers has been at the core of MyState. Since MyState has its focus on the digital mode, it might witness positive momentum moving forward.

On the monthly chart of MyState, MACD, a momentum indicator, has been applied by using the default values. The MACD line has crossed the signal line and is currently below the signal line. Therefore, we maintain our “hold” rating on the stock at the current market price of A$4.700.
 

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