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Bank of Queensland share price higher on coronavirus update

The Bank of Queensland Limited (ASX: BOQ) share price is pushing higher in morning trade.

At the time of writing the regional bank’s shares are up 2.5% to $4.90.

What did Bank of Queensland announce?

This morning Bank of Queensland became the latest company to withdraw its guidance because of the coronavirus outbreak.

According to the release, management believes the highly uncertain environment means it is too challenging to provide accurate forecasts for FY 2020. As such, it feels it is prudent to withdraw the FY 2020 guidance and outlook statements it provided at its Investor Day event in February.

That guidance was for FY 2020 cash earnings to be 4% to 6% lower than in FY 2019.

In addition to this, the bank’s board has decided that it will no longer seek APRA’s approval for an exemption in relation to the 12‐month profit test for its interim dividend.

Strong capital position.

Management notes that its capital position and funding remain strong during these tough times.

It has a pro forma FY 2019 CET1 Ratio of 10.07% following its recent capital raising, which represents a large buffer in excess of APRA’s unquestionably strong capital requirements.

Its funding position will also be further enhanced by the provision of the RBA term funding facility to support customers with new lending.

Positively, despite the significant shift in the economic environment, the bank remains focused on executing its refreshed strategy. It also notes that it retains the flexibility to respond to changing market dynamics.

The bank’s managing director & CEO George Frazis, commented: “We have a strong balance sheet with solid capital and funding, and robust risk management. We will support our customers in any way we can, especially at a time when some are feeling at their most vulnerable. We are here for our customers and will work with them through the challenges ahead.”

Elsewhere, big four banks Australia and New Zealand Banking Group (ASX: ANZ) and Commonwealth Bank of Australia (ASX: CBA) have started the week in a positive fashion. They are up 1.5% and 2%, respectively, in morning trade.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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