BEN - Bendigo and Adelaide bank

 BEN

01/07/26

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ASX:BEN (Bendigo and Adelaide Bank) has experienced a mixed five-year period characterized by a stable post-COVID recovery, but more recently faced profit contractions, margin pressures, and heavy digital transformation costs.

Financial Highlights (Trailing Twelve Months / FY2025)

• Profitability: Revenue has held relatively flat around the $1.92 billion mark. However, statutory profitability took a hit with a net loss of $83.3 million or a small profit depending on accounting adjustments, which missed analyst expectations. [1, 2, 3]
• Return on Equity (ROE): The ROE is trailing around -1.21% to -1.25%, down from positive historical levels between 6% and 8% seen over the previous four years, which historically trailed the broader banking sector average of 9.35%. [1, 2, 3, 4]

• Debt / Capitalization: As a retail and commercial bank, traditional "debt" manifests primarily through loan capital and customer deposits rather than corporate debt. The balance sheet remains well-capitalized with a CET1 ratio of 11.38% and total assets over $101 billion. [1, 2]
• Share Price: Despite shrinking earnings, the stock has shown resilience, trading near $10.32, keeping shareholders up around 5% to 74% over the last 5 years depending on the exact measurement. [1, 3]
• Dividends: The bank remains a consistent dividend payer, having declared an interim dividend of 30 cents per share. It offers a trailing yield historically hovering between 5.5% and 6%. [1, 2, 3, 4]

Book Value & earnings

Bendigo and Adelaide Bank (ASX: BEN) trades at a Price to Book (P/B) ratio of roughly 0.90x to 1.0x. This means BEN is valued by the market roughly at or slightly below the actual value of its net assets, trading at a discount compared to Australia's "Big Four" banks which generally command higher P/B premiums.

https://companiesmarketcap.com/aud/bendigo-and-adelaide-bank/pb-ratio/

https://stockanalysis.com/quote/asx/BEN/financials/ratios/

Key Details & Comparisons

• Bendigo and Adelaide Bank (BEN): Its Price/Book sits around 0.9x, reflecting market concerns over growth rates, competitive pressures, and regulatory compliance costs. [1, 2]
• Peer Comparison: The broader Australian banking sector and the "Big Four" (such as NAB, ANZ, WBC, and CBA) traditionally trade at an average P/B premium, often ranging from 1.2x to well over 2.0x (depending on the specific bank). [1, 2, 3, 4, 5]

Capital Buffer: When assessing book value, investors look at the Common Equity Tier 1 (CET1) ratio as a measure of a bank's financial strength. BEN carries a CET1 ratio of 11.3%, which is generally considered solid but slightly below the sector average of its larger peers. [1]

What This Means for Investors

Because BEN trades around 1x its book value, it is considered much "cheaper" on an asset basis than the major banks, often compensating shareholders with a solid fully franked dividend yield (around 5.6%). However, this lower book value valuation also reflects structural factors, including narrower margins and slower loan growth than its major competitors. [1, 2, 3]

Key Drivers Over the Last 5 Years

• Cost vs Transformation: The bank has been undergoing a multi-year transformation program to streamline costs and consolidate core systems. This has involved restructuring, job cuts, and heavy artificial intelligence (AI) and cyber partnerships to reduce ongoing expenses. [1, 2, 3]
• Up Digital Bank: Bendigo Bank's digital division, Up, has been a major growth engine, expanding to over one million customers and driving the bank's deposit-led strategy. [1, 2]
• Net Interest Margin (NIM): Like many regional lenders in Australia, Bendigo Bank has dealt with tight NIMs (hovering around 1.7% to 1.88%) and regulatory compliance costs, such as the AML/CTF uplift programs

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