Bendigo Bank profits decline by massive 57.7 per cent
Monday August 10, 2009
Bendigo Bank has reportedly suffered a profit loss of 57.7 per cent from last year's net profit, citing the slowing economy and global recession as the main contributors in addition to an unprecedented drop in the official cash rate and higher funding costs.
Bendigo Bank recorded a full-year net profit of $83.8 million for the 2008/09 net profit as compared to last year's net profit of $189.1 million. The figure of $83.8 million is far lower than the earlier guidance of $145.1 million after Bendigo bank released a profit warning in April. Currently Bendigo Bank's final dividend is at 15 cents per share, fully franked, down from 37 cents.
There were early warnings of the Banks predicted profit loss with an earlier released statement warning of the negative impact of the $20.2 million increase in specific and collective provisions for the Great Southern loan portfolio, particularly on the full-year cash earnings, with the representing less than 1.5 per cent of the entire Bendigo and Adelaide Bank asset base.
As a result of these figures, Bendigo Bank and Adelaide Bank have announced plans for an equity raising in the amount of $300 million.
The equity raising will be broken down as follows:
- Rights issue with retail and institutional shareholders for $173 million
- Ordinary shares with selected sophisticated and institutional investors for $127 million
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