Bank of Queensland posts $90.9m 1H profit
April 15, 2010
Bank of Queensland Limited (BOQ) reported a net profit of $90.9 million for the six months to 28 February 2010, up 96% on the previous corresponding period. The company said it was in a far stronger position than it had been at the start of the GFC and was now focused on delivering on its commitments to the market.
BOQ reported a normalised cash NPAT of $97.2 million for the six months, an increase of 15% on 1H09, while revenue jumped 13% to $342.9 million compared to the pcp.
Managing director, David Liddy, said the bank’s decision to continue lending through the GFC had paid off with lending growth more than two times system.
“As previously guided, bad debts increased in 1H10 as we expected they would, however we are now seeing an improved, more stable position,” Mr Liddy said.
“We have delivered on our commitment to improve our margins, increasing our net interest margins by 13 basis points from the first half of 2009 to 1.65%, despite increased funding costs.”
The company also reduced its normalised cash cost to income ratio by 9.2% over the past twelve months to 45.1%, with an overall reduction in total normalised cash operating expenses of 6% compared to the first half last year.
“While this is undoubtedly a significant achievement, we have deliberately created the cost head room to enable us to invest in marketing, brand, technology, and increased compliance and regulatory costs, while still targeting a full year cost to income ratio of 47%, as per guidance,” Mr Liddy said.
“We are delivering on our strategy of reducing capital intensity and increasing margins through complementary acquisitions, with the recent agreement to purchase St Andrew’s Insurance (Australia) Pty Ltd and St Andrew’s Life Insurance Pty Ltd and our ongoing review of merger and acquisition opportunities as they arise.
BOQ is also in exclusive discussions with CIT Group Australia and New Zealand regarding the purchase of their vendor finance business.
The company declared a fully franked interim ordinary dividend of 26c per share, matching the dividend provided in the first half of 2009.
As at 1015 AEST, Bank of Queensland shares were up 12c to $12.17.
BOQ reported a normalised cash NPAT of $97.2 million for the six months, an increase of 15% on 1H09, while revenue jumped 13% to $342.9 million compared to the pcp.
Managing director, David Liddy, said the bank’s decision to continue lending through the GFC had paid off with lending growth more than two times system.
“As previously guided, bad debts increased in 1H10 as we expected they would, however we are now seeing an improved, more stable position,” Mr Liddy said.
“We have delivered on our commitment to improve our margins, increasing our net interest margins by 13 basis points from the first half of 2009 to 1.65%, despite increased funding costs.”
The company also reduced its normalised cash cost to income ratio by 9.2% over the past twelve months to 45.1%, with an overall reduction in total normalised cash operating expenses of 6% compared to the first half last year.
“While this is undoubtedly a significant achievement, we have deliberately created the cost head room to enable us to invest in marketing, brand, technology, and increased compliance and regulatory costs, while still targeting a full year cost to income ratio of 47%, as per guidance,” Mr Liddy said.
“We are delivering on our strategy of reducing capital intensity and increasing margins through complementary acquisitions, with the recent agreement to purchase St Andrew’s Insurance (Australia) Pty Ltd and St Andrew’s Life Insurance Pty Ltd and our ongoing review of merger and acquisition opportunities as they arise.
BOQ is also in exclusive discussions with CIT Group Australia and New Zealand regarding the purchase of their vendor finance business.
The company declared a fully franked interim ordinary dividend of 26c per share, matching the dividend provided in the first half of 2009.
As at 1015 AEST, Bank of Queensland shares were up 12c to $12.17.
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