Hoping to bag the boosted Bendigo Bank dividend? Here’s how

Woman holding Australian dollar notes symbolising dividends.

Woman holding Australian dollar notes symbolising dividends.

Investors that want the dividend from Bendigo and Adelaide Bank Ltd (ASX: BEN) shares will need to be quick because the ASX bank share is about to allocate its dividend.

Bendigo Bank recently reported its FY23 half-year result and the bank also announced its interim dividend for investors.

Bendigo Bank ex-dividend date incoming

There is a cut-off date for when investors need to own Bendigo Bank shares. This is called the ex-dividend date.

Investors need to own shares before the ex-dividend date to be entitled to the dividend of 29 cents per share.

The ex-dividend date for Bendigo Bank’s dividend is 6 March 2023. That means investors need to own shares by the end of trading today because Monday is the ex-dividend date.

The payment date for the dividend is 31 March 2023.

Earnings recap

The interim dividend was increased by 9.4% to 29 cents per share. This came after a 22.2% increase in the earnings per share (EPS) to 52.2 cents.

Total income on a cash basis increased by 14.5% to $958.2 million. Meanwhile, the cost to income ratio was 54.6%, an improvement of 500 basis points.

A helpful part of the result was that the net interest margin (NIM) increased by 19 basis points (0.19%) to 1.88%. The NIM is a key profitability measure which tells investors how much profit a bank is making on its lending. While the revenue is from the lending, the cost of the lending is the funding, such as deposit savings.

The bank’s residential lending grew at the same pace as the overall loan system, while Bendigo Bank’s total lending fell 1.1%.

Total cash earnings increased 22.9% to $294.7 million, while statutory net profit after tax (NPAT) soared 49.3% to $249 million.

The Bendigo Bank CEO and managing director Marnie Baker said:

We are Australia’s most trusted bank with market leading customer advocacy and satisfaction scores. Our customer numbers are growing because customers are attracted to our products, digital capability, service levels and our longstanding purpose of feeding into the prosperity of the community.

At the full year result I spoke of our strengthened focus on returns, execution and sustainability. To the first focus area, through careful management of volumes and margins and prudent cost management we have delivered a 145- basis point increase in our ROE and a 500-basis point improvement in our cost to income ratio.

Our business must also be sustainable. Residential lending is growing at system on a rolling 12-month basis. Over the half it has tapered as we managed the trade-off between volumes and margins. We are competing selectively and seeking opportunities that deliver appropriate returns for our business and its shareholders.

Commsec numbers currently suggest that Bendigo Bank is going to pay a dividend per share of 60 cents in FY23, which is a potential grossed-up dividend yield of 9%.

Bendigo Bank share price snapshot

Since the start of the year, Bendigo Bank shares are flat in 2023 to date.

The post Hoping to bag the boosted Bendigo Bank dividend? Here’s how appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Bendigo And Adelaide Bank. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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