Bendigo and Adelaide Bank has delivered full year cash earnings of $530.2 million for FY26, a modest 3% increase on the prior year despite a challenging competitive environment and higher funding costs. The result reflects a deposit-led strategy that is beginning to pay dividends, with the bank successfully pivoting its customer base toward lower-margin but more stable funding sources. Management has maintained the full year dividend at 63 cents per share, comprising a final payment of 33 cents, signaling confidence in ongoing earnings resilience.
The bank’s deposit franchise has transformed materially over the past year. Lower-cost deposits now represent 54.8% of total customer deposits, up from 52.5% previously, while digital deposit sales reached 51.8% of new business and grew 34% year-on-year. This shift is the primary driver of the 5.1% growth in total income to $2.045 billion, as the bank benefits from both increased transaction margins and the structural efficiency gains that come with digital-first customer acquisition. Bendigo has also maintained momentum on customer acquisition, with metrics trending toward 3 million customers across the group. The bank’s Net Promoter Score sits at 21.8 points above the industry average, up 43.7 points from the prior year, suggesting that this transition to lower-cost deposits is not coming at the expense of customer satisfaction.
On the lending side, Bendigo delivered 1.5% growth in total lending volume during the year, a modest result against a backdrop of subdued credit demand across the sector. However, the second half of the year showed more encouraging momentum, with residential lending rising 1.9% in the half and business and agribusiness segments recording strong growth. More significantly, the acquisition of RACQ Bank’s retail loan and deposit books is tracking toward completion in the first half of 2027, subject to regulatory approval. RACQ brings 1.3 million customers, with existing exposures of $2.6 billion in loans and $4.1 billion in deposits growing at 56% and 45% year-on-year respectively. This acquisition has the potential to meaningfully rewrite the growth trajectory of Bendigo’s lending and deposit franchises.
The operating expense base grew 4.2% to $1.26 billion, broadly tracking inflation, though the second half saw a 2.1% decline as the bank captured productivity benefits. A notable point is the increase in non-cash charges to $155.1 million, primarily reflecting higher collective provisions in the second half. The board and executive have flagged risk management capability as their top priority, suggesting investors should expect increased focus on asset quality and provisioning policies in the coming year. The next material points to monitor are the completion and integration of RACQ Bank, the sustainability of digital deposit momentum, and the trajectory of credit losses as rates potentially decline and economic growth moderates. This announcement is classified as price sensitive and has been flagged as material by the ASX.
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About Bendigo and Adelaide Bank Limited (ASX: BEN)
An Australian financial institution formed by the merger of Bendigo Bank and Adelaide Bank in 2007, headquartered in Bendigo. The bank provides retail banking, business banking, and financial services including personal loans, mortgages, investment products, insurance, and superannuation through more than 400 branches. It serves retail customers and small to medium-sized businesses across Australia.
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