Bendigo and Adelaide Bank’s FY25: $97M Statutory Loss, 8.4% Rise in Cash Earnings
Bendigo and Adelaide Bank reported a statutory loss of $97.1 million for FY25, driven by a significant goodwill impairment, while cash earnings grew 8.4% to $514.6 million. The bank maintained its dividend payouts despite margin pressures and increased operating costs.
- Statutory loss of $97.1 million due to $539.5 million goodwill impairment
- Revenue increased 4.6% to $1.94 billion
- Cash earnings up 8.4% to $514.6 million
- Operating costs rose from transformation investments and inflation
- Fully franked dividends maintained at 33.0 and 30.0 cents per share
Statutory Loss Overshadows Underlying Performance
Bendigo and Adelaide Bank Limited (ASX – BEN) has reported a statutory loss after tax of $97.1 million for the financial year ended 30 June 2025, a stark reversal from the $545 million profit recorded in the prior year. This downturn was primarily driven by a non-cash goodwill impairment of $539.5 million related to its Consumer Cash Generating Unit, a significant accounting adjustment that weighed heavily on the bottom line.
Despite this headline loss, the bank’s core operations showed resilience. Revenue from ordinary activities rose 4.6% to nearly $1.94 billion, supported by an increase in interest-earning assets. However, margin pressures in the first half of the year tempered net interest income growth.
Cash Earnings and Dividends Signal Stability
On a cash earnings basis; a key measure of underlying business performance that excludes non-cash items like impairments; Bendigo and Adelaide Bank delivered an 8.4% increase to $514.6 million. Cash earnings per share rose to 91.0 cents, reflecting steady profitability despite external headwinds.
The bank declared fully franked final and interim dividends of 33.0 and 30.0 cents per share respectively, unchanged from the previous year. This signals management’s confidence in the bank’s ongoing cash flow generation and commitment to shareholder returns amid a challenging environment.
Rising Costs and Credit Outlook
Operating expenses increased due to planned investments in the bank’s transformation agenda aimed at long-term growth and simplification. Inflationary pressures and higher software amortisation charges also contributed to the cost rise. Meanwhile, credit expenses declined, reflecting a reduction in collective provision overlays and an improved macroeconomic outlook. The bank highlighted resilient credit performance, with the second half benefiting from the resolution of a specific provision-related matter.
Strategic Moves and Corporate Changes
During the year, Bendigo and Adelaide Bank sold its wholly owned subsidiary Bendigo Superannuation Pty Ltd to Betashares Australia Holdings Pty Ltd, marking a strategic divestment. Several controlled entities and special purpose vehicles were deregistered or terminated, streamlining the group’s structure.
The financial statements were audited by EY, who issued an unmodified audit opinion, affirming the integrity of the reported results. Investors are encouraged to review the detailed Operating and Financial Review in the 2025 Annual Report for a comprehensive understanding of the bank’s performance.
Bottom Line?
While the goodwill impairment clouds FY25 results, Bendigo and Adelaide Bank’s cash earnings growth and steady dividends suggest a foundation for recovery and transformation ahead.
Questions in the middle?
- How will the bank’s transformation investments impact future profitability and cost structure?
- What are the long-term implications of margin pressures experienced in the first half of FY25?
- Could further impairments or restructuring affect upcoming financial results?
