Bendigo Bank to pay one-off special dividend

Bendigo Bank will pay its shareholders a one-off special cash dividend of 15 cents per share, Chairman Richard Guy announced today.

Mr Guy said the special dividend formed part of the Bank's capital management strategy and would maximise shareholder value in the current investment environment.

"The special dividend will be paid from retained profits and will therefore reduce our Tier 1 capital, which is currently above our target range," Mr Guy said.

The special dividend will be paid on 28 February 2001 on shares held at close of trade on 16 February 2001.

The Bank's interim profit and interim dividend will be announced on 19 February and paid in April.

Mr Guy said the special dividend will be paid in cash and the Bank's dividend reinvestment plan and bonus share plan will not apply.

He said the decision to pay the one-off dividend was motivated by three key aims.

"Firstly, our Tier 1 capital ratio currently stands at 8.8 per cent, which is higher than our preferred ratio of seven per cent.

"Secondly, this special dividend will pass on franking credits at 34 cents, ensuring shareholders receive maximum value prior to tax changes which will see the franking rate reduce.

"And thirdly, the Board recognises that Bendigo's shareholders have supported their Company through a sustained five-year period of restructure as we built the framework needed to operate as a successful and unique bank.

"Throughout this five-year period, our shares have been tightly held by shareholders who recognised and supported our consistent strategy to reposition the organisation and its balance sheet to enhance this Company's long-term prospects.

"This special dividend we announce today is, then, in some measure a thank you to shareholders for their loyalty. At the same time, it is a measure of the confidence the Board has in the future growth prospects of Bendigo Bank.

"Our first-half profit announcement next month will confirm the continuation of the improved performance we have seen in recent years and we believe the Bank is now positioned for sustained profitability and growth."

Mr Guy said Bendigo Bank currently had on issue 113 million shares, meaning the one-off cash dividend would see a total payment of $16.9 million.