Bank of Queensland shares climb as UBS sees 'positive signs' in HY result
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More news: Bank of Queensland shares jumped 5% at market open after the lender reported a 13% rise in first-half net profit and raised its interim dividend.
BOQ shares were up 5% to $6.83 at 10:30am AEST, making it the best performing company across the ASX 200 index.
UBS, which has a 'sell' rating on BOQ and $6.50 price target, said the half-year net profit result was "mostly in line" with its estimates and "slightly better than what most analysts expected".
The analysts said the bank's revenue performance matched consensus, with a slightly improved net interest margin.
What they said: "We see some positive signs for BOQ as they start to implement their strategy, with changes in their portfolio mix and digital rollout beginning to show results," the analysts said.
BOQ posts 13% jump in half-year profit, lifts interim dividend
The news: Bank of Queensland reported a 13% rise in first-half net profit to $171 million, boosted by lower operating costs and growth in commercial lending.
The numbers: BOQ will pay an interim dividend of 18 cents per share, compared to 17 cents a year earlier.
Total income for the six-month period came to $793 million, flat compared to the prior corresponding period. The bank's net interest margin was also flat at 1.57%.
Operating expenses decreased 1% year on year to $520 million, as simplification benefits helped offset inflation.
The context: BOQ's managing director and chief executive Patrick Allaway said the group is making "considerable progress" towards transforming into a "simpler, specialist bank".
He noted that the half-year result reflects the bank's strategy to shift its portfolio towards higher-returning segments and reposition its retail bank as a "scalable, low cost-to-serve digital bank".
What they said: "The group has navigated some real challenges and is taking decisive action to enhance customer experience and improve the performance of BOQ for the benefit of our people, customers and shareholders," Allaway said.
"It is pleasing to see that the benefits from these bold decisions to simplify the business and execute our strategy are delivering positive outcomes, while recognising there is still more to do."
The sources: ASX, UBS research
