Bank of Queensland grabs loans business from other states, posts 19% rise in cash profit

Sunset at Snapper Rocks on the Gold Coast. Matt Roberts/Getty Images

The Bank of Queensland posted cash earnings of $167 million, up 19%, for the six months to the end of February on growing commercial and mortgage lending.

Almost half the bank’s total loan business, and more than half its home loans, are now with customers outside Queensland.

“What you see today is a bank that has come a long way in recent years,” CEO Jon Sutton said. “Strong foundations are now in place and we’re well into building a bank that is lower risk, lower
volatility, and set up for sustainable growth.”

Revenue was up 20% to $537 million and statutory profit increased 14% to $154 million. An interim fully franked dividend of 36 cents, a rise of 4 cents or 13%, was declared.

Retail lending grew at 6% a year to $27.3 billion over the February half.

Housing loans saw increased diversification with 57% of applications from outside Queensland, largely driven by brokers.

Commercial lending grew by an annualised 10% over the six months to $8 billion.

A greater presence in New South Wales, Victoria and Western Australia saw the geographic concentration of the portfolio in Queensland reduce further.

“We believe we can continue to drive growth through our existing strategy especially when you consider we’re still below our peers’ market share in the broker channel,” Sutton said.

The bank expects to launch mortgages via Virgin Money Australia in the next 12 months.

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