Bendigo and Adelaide Bank reported unaudited cash earnings of $122.2 million for the third quarter of the 2025 financial year, a 7.8% decline from the first-half quarterly average. Its statutory net profit after tax (NPAT) stood at $109.8 million, a modest 1.3% increase over the prior quarter.
The bank attributed the dip in cash earnings primarily to a 13.6% decrease in other income, driven by reduced completions in its Homesafe equity release program and lower account-keeping fees. Net interest income experienced a slight 0.3% decline, totalling $416.2 million, with the net interest margin remaining flat at 1.87%.
“The balance sheet remains well positioned for the current economic outlook with more moderate levels of growth expected in the future,” CEO Richard Fennell said. “We remain focused on sustainable growth and productivity improvements as we scale the business.”
Expenses and income down
Operating expenses were trimmed by 1.2% to $295.6 million, aided by reduced staff costs, even as investment spending saw a slight uptick. Credit expenses were reported at $1.9 million, with higher specific provisions in the consumer segment partially offsetting lower collective provisions.
On the lending side, residential mortgage growth slowed in the final month of the quarter, bringing the annualised growth rate below 10%. Deposit growth remained steady, with savings accounts (excluding offsets) growing at a 9.3% annualised rate, while transaction account balances declined.
Business lending growth was primarily driven by portfolio funding over the quarter, the bank said.
Rural Bank overhaul, balance sheet strength
A significant milestone in the bank’s ongoing transformation was the migration of the Rural Bank system and the retirement of the Rural Bank brand, the culmination of a six-year strategic overhaul aimed at simplifying operations. The move reduced the number of core banking teams from eight to two, enhancing efficiency and scalability.
Bendigo Bank’s balance sheet remains robust, with a customer deposit funding ratio of 77%, a quarterly average liquidity coverage ratio (LCR) of 134% and a monthly net stable funding ration (NSFR) of 117%.
The Common Equity Tier 1 (CET1) ratio stood at 10.83%, down 34 basis points from the previous quarter, reflecting the payment of the first-half dividend and regulatory adjustments.