Bendigo and Adelaide Bank Ltd: Company and Investment Analysis

Bendigo and Adelaide Bank Ltd is a significant player in the Australian banking sector, with a long history dating back to 1858. The bank's origins can be traced to the Bendigo Bank, which was founded in the gold rush town of Bendigo in Victoria.

The bank's name change to Bendigo and Adelaide Bank Ltd occurred in 2007, following the merger with the Adelaide Bank. This move marked a significant expansion of the bank's operations, both in terms of its geographic reach and its product offerings.

One of the key features of Bendigo and Adelaide Bank Ltd is its commitment to community banking. This approach focuses on providing financial services to local communities, with a strong emphasis on customer service and support.

Bendigo and Adelaide Bank Ltd has a strong presence in regional Australia, with over 600 branches across the country. This extensive network allows the bank to serve a diverse range of customers, from individuals and small businesses to larger corporations.

Bendigo and Adelaide Bank Limited is an Australia-based banking and financial services company.

It was founded in 1995, but its history dates back to 1858 when it was established as the Bendigo Building Society.

The company operates in various sectors, including consumer, business, and rural banking.

It offers a range of services, including consumer, residential, business, rural and commercial lending, deposit-taking, payments services, wealth management, margin lending, and others.

The Consumer division focuses on engaging with and servicing its consumer customers.

The Business and Agribusiness segment focuses on servicing business customers.

Here are some key statistics about the company:

The company is headquartered in Bendigo, Australia, and can be contacted through its phone number +61 35445-0666 or fax number +61 35485-7668.

Bendigo and Adelaide Bank's Community Program has been incredibly successful, with over $366 million reinvested back into local communities since 1998. This 'profit-with-purpose' model ensures that profits are returned directly to the community that generated them, after paying branch running costs.

Funds generated from the program have supported a wide range of community needs, including emergency and rescue services, aged care facilities, sports parks, and classrooms. It's amazing to think about the positive impact this has had on local communities.

The bank's commitment to community investment is truly inspiring, and it's no wonder that they've extended the program to major metropolitan areas with existing bank services.

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Bendigo Bank's Community Banking program is based on a 'profit-with-purpose' model, where profits are returned directly to the community that generated them, after paying branch running costs.

This model has been a game-changer for rural areas, which have seen a massive closure of bank branches over the years.

Since 1998, Bendigo Community Banks have reinvested more than $366 million back into local communities.

This funding has helped support emergency services, such as rural fire brigades and the State Emergency Service (SES), as well as other community needs like buses, defibrillators, and aged care facilities.

Here's a breakdown of some of the community projects that have benefited from this funding:

The Community Banking program has been extended to major metropolitan areas with existing bank services, demonstrating the bank's commitment to giving back to the community.

Institutional shareholders play a significant role in shaping the direction of a company. State Street Global Advisors, Australia, Ltd. holds the largest number of shares, with 22.51 million shares as of December 19, 2023.

The top institutional shareholders have increased their shareholdings in recent periods. For example, State Street Global Advisors, Australia, Ltd. bought 2.99 million shares, a 15.33% increase, while BlackRock Fund Advisors bought 1.77 million shares, a 17.75% increase.

Here's a breakdown of the top institutional shareholders:

Some institutional shareholders have decreased their shareholdings. For instance, BlackRock Investment Management (Australia) Ltd. sold 2.58 million shares, a 28.77% decrease, while Franklin Templeton Australia Ltd. sold 468,410 shares, an 8.10% decrease.

Bendigo and Adelaide Bank's financial performance is a key area to focus on. The bank's share price tumbled after it announced lower earnings than expected, but it assures that it's well within the market operator's guidelines.

The bank's lending business is a significant contributor to its revenue. In fact, it earned 87% of its total income just from lending last year.

Bendigo and Adelaide Bank's net interest margin (NIM) is a crucial measure of its profitability. The NIM is the difference between what the bank pays to savers and what it makes from mortgage holders.

The bank's NIM is 2.3%, which is better than the average of 1.87% among the ASX's major bank shares. This means the bank produces a better-than-average return from lending money to customers versus its peers.

The bank's ability to generate a wide NIM is essential for its business profitability. It needs deposits and good profit margins to make its business profitable.

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Bendigo and Adelaide Bank has a dividend payment history that dates back to 2004. The bank's dividend payments have been consistently high, with a few exceptions.

The bank's dividend payments have been fully franked, meaning that investors receive the full value of the dividend. In fact, the bank's dividend payments have been 100% franked since 2004.

Here's a breakdown of the bank's dividend payments over the past 10 years:

The bank's dividend payments have been steadily increasing over the past few years, with some fluctuations.

The Ben share price has been quite volatile over the past few weeks. On 17 Feb 2025, the share price dropped by 15.28% to $11.37.

Looking at the data, we can see that the share price has fluctuated significantly. On 14 Feb 2025, it reached a high of $13.56, but then dropped to $13.28 on 13 Feb 2025.

On 10 Feb 2025, the share price closed at $13.50, which is the same price it was on 07 Feb 2025. This suggests that the price has been relatively stable in recent days.

The share price has also shown some significant drops in recent weeks. On 17 Feb 2025, it dropped by $2.05 to $11.37.

Dividend valuations are a useful tool for estimating the value of a share. According to the article, using a dividend discount model (DDM) can provide a quick and simple way to estimate the value of Bendigo & Adelaide Bank Ltd shares.

The article provides an example of using a DDM to estimate the value of BEN shares. The calculation used is: Share price = full-year dividend / (risk rate – dividend growth rate). This calculation takes into account the bank's last full year of dividends and applies a risk rating.

The article suggests using multiple risk rates and averaging the valuations to get a more accurate estimate. Using this method, the estimated average valuation of BEN shares is $10.71. However, using an 'adjusted' dividend payment of $0.65 per share, the valuation goes to $11.05.

Here's a table showing the estimated valuations using different risk rates and dividend growth rates:

The article also notes that using a 'gross' dividend payment, which includes the franking credit, can provide a more accurate estimate of the share's value. Using this method, the estimated fair value of BEN shares is $15.78.

Next week is a big week for bank shares, with three of Australia's 'Big Four' banks and a regional bank reporting to the market.

The Commonwealth Bank, Westpac, and ANZ Bank will all be releasing their earnings updates, giving investors a chance to see how these financial giants are performing.

Three of Australia's 'Big Four' banks plus a regional bank will report to the market next week.

The ASX is taking a closer look at Bendigo Bank's share price drop.

Bendigo Bank's share price took a significant hit, tumbling 16% in a short period. This decline has left investors wondering if it's a buying opportunity.

On February 17, 2025, the share price dropped by $2.05, a 15.28% decrease. This was the largest drop in the past month.

The bank's share price had been steadily increasing until February 17, 2025, when it plummeted. This sudden drop has raised concerns among investors.

On February 14, 2025, the share price was at $13.42, but it dropped to $11.37 on February 17, 2025. This is a significant decline in just three days.

The ASX is querying Bendigo Bank's disclosures to understand the reason behind the share price drop. The bank has stated that it is well within the market operator's guidelines.

Here's a summary of the share price drop:

The ASX is taking a closer look at the bank's financials to determine the cause of the share price drop.

Peer analysis is a crucial aspect of evaluating a company's performance. It involves comparing the company's key metrics with those of its peers to identify trends and potential areas for improvement.

The table below summarizes the revenue (TTM) of the companies mentioned in the article.

Looking at the table, we can see that Bendigo and Adelaide Bank Ltd has the highest revenue among the four companies, followed closely by Computershare Ltd.

The price/earnings (TTM) ratio is another key metric to consider in peer analysis. As shown in the article, Judo Capital Holdings Ltd has a price/earnings (TTM) ratio of 37.73, while Bendigo and Adelaide Bank Ltd has a price/earnings (TTM) ratio of 14.51.

By comparing these metrics, we can gain a better understanding of each company's relative performance and identify areas where they may be lagging behind their peers.

Bendigo and Adelaide Bank offers a range of investment options to help you grow your wealth over time.

Their investment products include term deposits, which can provide a low-risk return on your investment, with rates as high as 2.50% per annum.

Bendigo and Adelaide Bank's term deposits are flexible, allowing you to choose from a range of terms from 30 days to 5 years.

The bank's investment options are designed to cater to different needs and risk tolerance, making it easier for you to make informed investment decisions.

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