UPDATE 2.30pm: Bendigo and Adelaide Bank (and Tiimely) have announced a 25bps cut to new and existing variable-rate home loans, effective 7 March.
First, let's get to the consumer angle on Bendigo's silence on passing on rate cuts to home loan customers; second, let's talk about its flat results; third, let's talk about its mooted bank takeovers; and finally let's briefly mention its outgoing CEO.
Plus I'll throw in a few Simpsons references to keep it entertaining.
As a bank that likes to portray itself as a moralist alternative to the big four banks, who have actually been pretty upfront with their rate cutting action, Bendigo Bank has been a cluster recently, and its lacklustre performance could explain the poor comms to customers.
Bendigo Bank is Australia's sixth (or seventh) largest bank depending on how you measure it yet after assessing its last year or so, it belongs in the minor leagues, or a high school playground.
Radio silence on rate cuts
It's Friday afternoon and still nothing on announcing passing on rate cuts to home loan customers. [Note: This has changed as of 1.30pm.]
Just after midday, however, its subsidiary Up Bank announced a 25 basis point cut on its savings account, down to 4.10% p.a.
All of the other 10 largest banks in Australia have announced what they're doing to home loans in the wake of the first RBA rate cut in four years.
Westpac pulled the trigger on announcing a cut literally one minute after the decision, while most of the others followed in a timely fashion.
Forums have been alight with commentary and questions about Bendigo's moves, paraphrasing Fat Tony: Where is the money? When are you going to get the money? Why aren't you getting the money now? And so on. So please, the money.
Bendigo Bank risks being left standing in musical chairs if it waits too long. However it did cut term deposit rates, though these can almost be a considered an entirely different game.
This is exacerbated by its underwriting of Up Bank and Tiimely Home (formerly Tic:Toc), both digital brands with a flair for t-shirts and baseball caps in board rooms, promising to move fast and break things.
In any case this pending rate cut hasn't been very tiimely, so tic toc.
My tin foil hat moment is wondering if they are figuring out ways to NOT pass on the full 25 basis point cut to home loan rates, which could be explained by its lacklustre results.
Lacklustre results
It's reporting season time for the first six months of the 24-25 financial year. And shareholders haven't been happy with Bendigo's stinker.
While it's up from the previous day at the time of writing, it's shed more than $1.5 billion in market cap since the start of February.
It lost about 18% of its share price on 17 February, the worst performer on the ASX 200 that day.
The reason?
Its results showed statutory profit after tax fell 23.2% to $282.3 million; its net interest margin (NIM) fell 6 basis points to 1.88%.
Tech stack transformation from the baseball caps and operating costs soaring 5% are to blame.
It's also running down a hill too fast, chasing lending growth at the sacrifice of margin.
In comparison CBA managed to increase its NIM over the last six months of calendar year 2024, up 2 basis points (compared to the previous six months) to 2.08%.
For Bendigo the bright spot was Up Bank, with one million customers, and $1.2 billion in loans, and $2.6 billion in deposits - up more than 100% and 23% on the half-year respectively.
Mooted bank takeovers
Bendigo Bank was frequently touted as a suitor to take over Suncorp's banking business when the Queensland insurance giant took it to market a couple years ago.
Never mind that fundamentally it looked like a shot in the dark, with Bendigo and Suncorp's loan and deposit books of similar size, and its capital position would barely have covered it.
ANZ ended up acquiring Suncorp's banking division in a deal worth $4.9 billion; for Bendigo to cover this it would have needed to be an "all scrip" deal, meaning shareholders would have needed to accept shares in Bendigo as payment.
Then, the ACCC blocked the ANZ-Suncorp deal, and Bendigo was floated once again; even the ACCC itself fancied Bendigo better.
But ANZ took that to the competition tribunal, which overturned the ACCC decision last year.
Reputational damage for the competition regulator, and collateral damage for Bendigo.
Battered and bruised, it's now reported by industry publications Bloomberg and Capital Brief (paywalled), that Bendigo could throw its hat in the ring to acquire HSBC's Australian consumer book.
That's about $32 billion in residential home loans and $18.5 billion in deposits - a more munchable meatball than the Suncorp book, but NAB's also reportedly a suitor.
And as we know, NAB has good form in the acquisition stakes, acquiring Citi a couple years ago (and ergo Diners Club, which packed up, leaving AMEX with a monopoly on charge cards - thanks ACCC).
NAB also acquired neobank t-shirt gang 86 400 for about $200 million a few years ago, too. It then merged it into its digital brand ubank.
So if this HSBC deal is true and fails to get up, Bendigo risks a huge reputational hit, both in business and consumer circles.
The latter of which its communities the bank purportedly cares so much about. The latter of which would rather just see forthright communications on rate cuts.
Nobody likes Bendigo! Source: imgur
Outgoing CEO now a RBA mover and shaker
Former Bendigo CEO Marnie Baker found a plum gig on the RBA's monetary policy board.
She spent 35 years at Bendigo, and you don't get there by accident; company culture starts from the top down, and her departure creates a huge loss of expertise at the bank.
She left in August 2024, and its new CEO is Richard Fennell, who has been there since 2007.
Federal Treasurer Jim Chalmers said Ms Baker brings an important regional perspective to monetary policy decisions, while also explicitly making mention of the strong presence of women on both the monetary policy and governance boards.
This comes at the same time as cynics have accused Dr Chalmers of stacking the boards with friendlies and sympathisers - not saying Ms Baker is either.
As Judo Bank chief economic adviser Warren Hogan told me on my podcast (the Savings Tip Jar) this week, the RBA risks falling victim to politicisation off the back of the latest cut.
"It seems to be the RBA making a judgement about how they're perceived in the community and what could happen in the election campaign to their position and the way people talk about them if they didn't cut rates," he said.
"Australians have always been confident that the RBA is there to be sensible, to be the adult in the room and to be staunch and to do the right thing by the community in the long term. And I think that's really coming into question right now."
Just an interesting aside to the Bendigo debacle.
Oh Bendigo, can't you go five seconds without humiliating yourself?
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