Bendigo Bank delivered a solid FY17 cash profit of $418 million, which was in-line with consensus. Improving margin trends and dividend growth helped push the shares of BEN higher in yesterday’s trading.
We feel the regional banks will struggle in the next 12 to 24 months with flat earnings, higher costs and increasing debt debt provisioning.
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Assuming flat earnings and dividend growth into FY18, we have BEN trading on a 6% forward yield.
