It was more good news on the bad debt front for Bendigo and Adelaide Bank which has joined its larger peers such as Westpac and the ANZ in writing back some of 2020’s bad debt provisions.
Bendigo told the ASX on Thursday that its full-year results, due out on August 16 will include the release of $19.4 million worth of provisions for bad loans.
It is part of the $127.7 million provision raised in May of last year in preparation for a worst case COVID-19 pandemic scenario.
“The Collective Provision release reflects the improved economic outlook for the Australian economy, including rising GDP, lower unemployment and higher residential property prices compared to 31 December 2020,” the bank said in a release to the ASX.
The Bank said this is partially offset by an increase in provisions reflecting the continued economic uncertainty, and the potential impacts of current and future lockdowns.
Bendigo said credit expenses for the 2021 financial year are $18 million down from $37.4 million prior to the latest adjustment.
(And will Victoria’s latest lockdown force a further adjustment?)
Bendigo also reported that the arrears ratio for residential mortgages and business loans are also lower compared with June 30 last year.
Bendigo said it is still helping 273 personal customer accounts with lending balances to the value of $83.7 million as at July 30, the bank told the ASX.
“Since the start of the pandemic, we have provided more than 25,000 personal and business customer accounts with dedicated support to give them the best opportunity to weather the impacts of the COVID-19 pandemic, and our experience to date has demonstrated the importance of this support in assisting affected customers. With the latest round of restrictions, this commitment has not changed,” CEO, Marnie Baker said in Thursday’s statement.
Bendigo said its home loan book expanded by 14% in the half, which was more than three times the average pace across the industry (called ’system growth’).
Bendigo shares rose 1.2% to $10.58 on Thursday.
