THE repricing of investor home loans has paid off for Bank of Queensland (ASX: BOQ) which has declared a special dividend in the wake of strong second-half lending growth.
BOQ declared a flat final dividend of 38 cents and a special dividend of eight cents on the back of two per cent growth in the group's home loan lending sector.
The bank lifted full-year cash profit by five per cent to $378 million, with statutory profit for the 12 months to August 31 up four per cent to $352 million.
Jon Sutton, BOQ managing director, says the second-half performance of BOQ gives the company momentum heading into FY18.
"The second half largely played out as we said it would at our first half result," says Sutton.
"Lending growth improved in both the housing and commercial loan portfolios. The Virgin Money Reward Me home loan portfolio has grown ahead of expectations."
Sutton went on to reassure investors that BOQ is on a strong path, despite the banks currently operating in a dynamic commercial environment.
"We have seen return to growth in the second half which gives us confidence going into FY18," says Sutton.
"The industry faces challenges of low housing credit growth, low interest rates, regulatory uncertainty, increasing consumer expectations and increased scrutiny of conduct and culture.
"We have responded well to these challenges and have been able to continue delivering our strategic priorities and returns for shareholders."
Sutton says productivity and efficiency improvements remain a priority for BOQ along with an improvement in BOQ's strong capital position.
The group's Common Equity Tier 1 ratio was up 10 basis points over the half to 9.39 per cent. The position will be further strengthened by 20 to 25 basis points following regulatory changes, according to the company.
Following this morning's announcement, BOQ's shares are up 1.93 per cent to $13.19 per share.
Business News Australia
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