• Cash earnings after tax of $256.4 million, up 2.8% on prior half
• Net interest margin increased 4 basis points to 1.92%
• Operating expenses increased 4.2%, driven by wage inflation and investment
• Dividend of 30.0 cents per share, in line with target payout ratio

In the first half of FY26, Bendigo and Adelaide Bank recorded cash earnings after tax of $256.4 million, a 2.8% increase on the prior half but 3.3% lower than the prior comparative period. Cash earnings per share improved to 45.3 cents and Return On Equity (ROE) increased to 7.76%. The bank self-disclosed and commenced addressing an Anti-Money Laundering/Counter-Terrorism Financing (AML/CTF) matter, with AUSTRAC commencing an enforcement investigation and APRA imposing a $50 million capital overlay. Total assets of $101.3 billion reduced 1.9% during the half, reflecting reduced residential lending, mostly in third party originated channels. Business lending grew 2.8%, led by growth in the Portfolio Funding business, while Agri lending was down 6.2%. Customer deposits grew 1.1% to $73.7 billion, with lower cost deposits up 3.6%. Income increased 3.7% to $1,009.9 million, with net interest margin up 4 basis points to 1.92%. Total operating expenses increased 4.2% to $636.5 million, driven by higher staff costs, software amortisation, and remediation expenses. The bank recorded a net credit release of $2.4 million, with the Common Equity Tier 1 (CET1) ratio increasing to 11.37%. The bank announced an agreement to acquire RACQ Bank's retail loan and deposit books, expected to be completed in H1 FY27.

The bank remains committed to investing the capital required to drive its 2030 strategic initiatives while uplifting its AML/CTF risk management capabilities and integrating the RACQ Bank loan and deposit books. The bank's commitment to achieving a ROE of above 10% by 2030 is unchanged and supported by its disciplined focus on business-as-usual cost growth of 'no higher than inflation through the cycle' and driving a deposit-led approach to sustainable growth in lending.

The bank is focused on streamlining its technology foundations and delivering sustainable growth and improved shareholder returns. Key strategic initiatives include the completion of the migration of Adelaide Bank customers onto the bank's single core banking platform, the rollout of the Bendigo Lending Platform to all retail branches, and the launch of digital onboarding. The acquisition of RACQ Bank's retail loan and deposit books is expected to enhance the bank's geographic diversity and customer base.