AGM 152 - Bendigo and Adelaide Bank

Shareholders told:  Good but interesting times best describe current operating environment. Planning for growth continues.

Shareholders of Australia’s fifth largest full service retail bank, Bendigo and Adelaide Bank, today heard that 2017 has been a good year for the group.  Profit performance was strong and well received by the market for growth in both margin and balance sheet.

An outline of the group’s performance and continued efficiency improvement was also well received by shareholders who saw an improvement of 15.4% in share price over the year and with an increase of a further 10% this financial year to date with solid dividends.

Managing Director Mike Hirst said:   “All of our businesses have contributed to this strong result.  I am confident that we are investing wisely for the future of the bank and that shareholders will benefit through our continuing investments in technology, our partnerships and our investment in staff.  All are factors at the centre of our strategy.

“We consider these investments to be well aimed at future proofing the bank by helping us be relevant to our existing customers and to make us worthy contenders for consideration by those customers who might be looking to change banks.

“In thinking about the current operating environment – and how relevant our strategy is in its context - where do we stand?   Well, we know we have the highest trust rating out of all the listed banks; the highest customer satisfaction and the best customer advocacy.

“I think we could do more to convince people of the value available to them - and their community - in moving their banking to us and better telling our story. Among our major competitors, this is a significant advantage.

“Some twenty years down the track after establishing our Community Bank model - amid widespread major bank branch closures and community angst against the banking sector, the very thing that opened the window for our growth through that model, is again at all-time highs.  Is that window to growth open again?  I believe it is.

“Our banking models and brands all clearly evidence our original purpose of feeding into community prosperity, a purpose that is still with us. We hold a strong sense of stewardship for our culture that is firmly centred on the customer; and with a network that is extraordinarily connected at the local level.   All of that places us in good stead, in fact in the pole position to benefit from this environment.

“When I look around the banking market I can't see anyone better placed to do that than us. I see many talking about the future and what the impacts might be, but most of them have an immediate focus of just trying to get to where we are.

“Pleasingly, with the mooted changes APRA is making to their capital and risk weight regime, it may be that we are even moving toward a reasonably level playing field.  So from here it's about telling our story and asking people to join us in order to bring about the change they are wanting to see.
“We will be highlighting the positive attributes of our model and we will continue to let our actions speak louder than words in this and future years.

Chairman Robert Johanson welcomed shareholders to the 152nd annual general meeting and told shareholders that the company was reflecting on a number of significant anniversaries, some to be celebrated and some to serve as salutary lessons for generations of customers and investors to come.

These included the 30 years since the great stock market crash of 1987, the 10 year anniversary of the merger between Bendigo Bank and Adelaide Bank, the second anniversary of the opening of a Bendigo Bank agency in Nauru and the first birthday of the opening of the Deakin University Community Bank.

Mr Johanson said “Australia went into the GFC with much stronger, better enforced banking regulations than most other countries and that this was one very significant reason why there was so little direct impact on customers here”.

He noted that “The much tighter, more prescriptive rules on capital and risk that have been imposed around the world have been picked up here too”.

“Some of those rules, as we have been discussing for many years, gave some banks very significant competitive advantages and we applaud the recent tightening of rules on risk weightings for assets and additional capital and liquidity requirements.

“Perhaps the most significant consequence of the GFC and the circumstances that led to it has been the collapse in public trust in banks and bankers and, indeed, in business and corporations generally.

“Now this collapse in trust is not limited to banks and business.  Politicians and government, the media, churches – all sorts of institutions which used to be seen as the underpinning of our civil society are now routinely reviled, usually through the instantly gratifying mechanisms of social media.

“We have invested a large amount in improving our bank’s risk management systems, as we needed to do for a business the size that we are now - and plan to become. That has made our business stronger and more robust.

“We are now waiting on the next release from APRA on risk weightings to see what steps we should take in relation to our application to become an advanced accredited bank”, Mr Johanson concluded.

The meeting re-elected re-elected directors Jacqui Hey and Jim Hazel.  The meeting passed all resolutions and the Remuneration Report.

Item 2. Re-election of Jacquie Hey as a Director

In FavourAgainstAbstentionResult
1,019,316 Carried

Item 3. Re-election of Jim Hazel as a Director

In FavourAgainstAbstentionResult
1,032,738 Carried

Item 4. Remuneration Report 2017

In FavourAgainstAbstentionResult
1,851,580 Carried

Links to full versions of both addresses by the Managing Director and Chairman on the ASX website.