Bank of Queensland (BoQ) has announced an increased dividend and a rise in annual profit, driven by strong growth in commercial lending. This positive performance helped to offset a contraction in the bank’s mortgage portfolio. BoQ is a regional bank that provides a range of financial services, including retail and business banking, and wealth management. The bank aims to provide a genuine alternative to the big banks.
For the 12 months ending August 31, BoQ reported a 12 per cent increase in cash profit, reaching $383 million. The Brisbane-based lender declared a fully franked final dividend of 20 cents per share, an increase from the interim dividend of 18 cents. The result aligns with the bank’s August guidance, which projected cash earnings between $375 million and $385 million.
Net interest income saw a 4 per cent increase over the year, and the bank’s net interest margin, a key profitability indicator, rose to 1.64 per cent. This represents a 13-basis-point improvement from the first half of the year. According to Chief Executive Patrick Allaway, the bank is making substantial progress on its transformation program.
In August, BoQ withdrew its return-on-equity and cost targets, also indicating additional restructuring charges. These charges include costs associated with over 100 redundancies. The bank also announced intentions to sell up to $3.8 billion in loans from its equipment finance portfolio and revealed a new artificial intelligence agreement with Capgemini.
