Investors will look to updates this morning from Macquarie Group (MQG) and the ANZ Bank (ANZ) for further evidence that the solid performance of the country’s banks is continuing in the current reporting season.
March-balancing Macquarie is expected to harden up already raised guidance for 2014-15 and perhaps give investors an idea of the thinking for the new financial year starting April 1.
The ANZ will give us a first quarter trading update – it rules its first half books off on March 31. If it follows the update from the NAB and the interim from the Commonwealth, it will increase cash profits by around 5% to 8%.
Yesterday the small regional Bendigo and Adelaide (BEN) joined the generally upbeat reporting season (the Commonwealth and NAB already with good reports in the market), revealing a solid rise in cash earnings for the six month period and a small rise in interim dividend of 2c a share to 33c.
And contrary to what the Commonwealth and the NAB reported, Bendigo maintained its net interest margin – over the six-month period at 2.24%, having expanded it by 5 basis points in the year to last June.
Cash profit rose 17% to $217.9 million, almost matching market forecasts.
Revenue for the six months ended December 31 rose 10.5% to $786.1 million.
BEN 1Y – Bendigo lifts H1 profit
The result was helped by a $24 million contribution to the regional lender’s net interest income by its acquisition of Rural Finance Corporation of Victoria in 2014, accounting for almost half of the total growth net interest income of $52.6 million.
Statutory net profit rose to $227.3 million in the six months through to December from $180.7 million a year earlier.
Bendigo completed the $1.78 billion purchase of Rural Finance Corp last July from the Victorian state government, which will expand lending to farmers in its home state of Victoria.
But the market wasn’t all that impressed: the shares started the day solidly, and then fell sharply in the afternoon to close off 4.4% at $23.74. Another example of buy on the rumour, sell on the fact?
