5pm
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
BENDIGO Bank will continue to reshape its business but any extra job losses remain unknown, as COVID-19 ravages bank's profits.
The bank reported a drop in profits of 48.8 per cent for 2019-20, which it attributed to the COVID-19 crisis and record low interest rates.
Managing director Marnie Baker said the profit announcement was driven by a conservative approach in a time of uncertainty.
OTHER NEWS:
"If you look to the underlying business itself, [it] is growing really strongly, well and truly above systems," Ms Baker said.
Ms Baker did not comment on whether the 2019-21 profit drop would drive any additional job losses.
The organisation shed 84 staff members in 2019-20, and flagged at the time this might continue as the organisation worked on "right-sizing and right-shaping" its business.
Ms Baker said the bank's transformation strategy would continue, which meant divesting in certain areas and "accelerating" in others.
"We will be changing the skills that are required, redeploying people into different roles, upskilling," Ms Baker said.
"There may be some people that actually do leave the organisation as a result as well, but that's not focused on Bendigo, that's across our national organisation.
"As we reshape our business there's going to be roles that are no longer required, so it will have an impact on people. We are also recruiting for the skills we are looking for for the future."
11:45am
BENDIGO Bank's move to defer a dividend decision reflects the uncertainty of the financial environment, representatives say.
The deferral was among key points as the bank announced its 2019-20 financial results.
The bank reported a 48.8 per cent drop in its net profit for the financial year.
OTHER NEWS:
A representative said the deferral of a dividend decision was a prudent decision to preserve capital, in response to journalists' questions.
It was made in the light of financial uncertainty, especially in Victoria, a representative said.
Managing director Marnie Baker, chief financial officer Travis Crouch and chief risk officer Taso Corolis responded to journalists' questions following an the bank's announcement at 10am.
Earlier
BENDIGO Bank has reported a 48.8 per cent drop in its net profits for the 2019-20 financial year.
Managing director Marnie Baker attributed the drop to COVID-19, record low interest rates, and the investment costs required to support the delivery of its strategy.
Ms Baker warned the bank expected market conditions to remain challenging. This meant the Bendigo Bank was unable to provide meaningful guidance for the 2020-21 financial year.
The bank's statutory net profit for 2019-20 stood at $192.8 million.
Its cash earnings after tax were at $301.7 million, down 27.4 per cent.
Ms Baker said the events of 2020 hadn't changed the bank's strategy announced last year, but ongoing economic uncertainty had accelerated its need to transform.
The bank's net interest margin was at 2.33 per cent, down three basis points. Its total income on a cash basis was at $1.61 billion, up 0.9 per cent.
Bad and doubtful debts were at $168.5 million, influenced strongly by COVID-19 collective provision of $127.7 million.
Cash earnings per share were at 59.7 cents per share, down 29.8 per cent.
The final dividend decision has been deferred.
Total lending was at $65.3 billion, up 5.1 per cent.
Total deposits stood at $68.7 billion, up 5.7 per cent.
Ms Baker said despite the effects of COVID-19 on cash earnings, the bank delivered total income of $1.61 billion, up 0.9 per cent on the previous financial year.
She said the bank had sustained market leading trust ratings and further strengthened its balance sheet.
Ms Baker said the bank saw significant customer growth continue, an increase of 9.9 per cent, leaving the bank with a record 1.88 million customers.
She said the bank would continue to focus on maintaining a strong and resilient balance sheet into 2020-21, supported by growth and a clear transformation strategy.
"We're observing how COVID-19 is changing the world and considering how we can use this to shape the future of work and continuously improve as leaders in customer experience," Ms Baker said.
Have you signed up to the Bendigo Advertiser's daily newsletter and breaking news emails? You can register below and make sure you are up to date with everything that's happening in central Victoria.