Last month, the S&P/ASX 200 Index (ASX: XJO) had a pretty great time. Not only did the ASX 200 put on an additional 1.9% over May, it also hit not one, but two, new record highs.
This was driven by many ASX banking shares. The big four ASX banks make up 4 of the ASX's 6 largest companies. As such, their movements are extremely important to how the ASX 200 performs overall. And many banking shares had a top month.
Most prominent was the Commonwealth Bank of Australia (ASX: CBA), which managed to hit $100 a share for the first time in May. But what of the smaller ASX banks? Well, let's check out Bank of Queensland Ltd (ASX: BOQ) today.
So, Bank of Queensland has had a pretty solid year of performance over the past 12 months. It has managed to add around 69% to its value over this period, not including dividend returns. It's also up a healthy 17.8% year to date.
But what of May? Well, BOQ shares started the month at a price of $9.02 a share. By Monday afternoon, the bank was asking $8.95 a share. Yep, Bank of Queensland had a red May, losing 0.78% of its valuation.
Image source: Getty Images
More money, ME problems
Well, perhaps the largest factor that might have been weighing on Bank of Queensland shares over May was the woes facing its most recent acquisition – ME Bank. Back in February, BOQ announced that it would poach the formerly mutual Me Bank for a price of $1.35 billion. This was funded via a capital raising program shortly after. It's that acquisition that might have caused some consternation from investors in May.
That's because we learnt on 27 May that the Australian Securities and Investments Commission (ASIC) was filing charges against Me Bank in the Federal Court of Australia. As my Fool colleague Brooke Cooper comprehensively covered at the time, ASIC is alleging that BOQ breached laws relating to giving false or misleading information, as well as the National Credit Code. These alleged incidents are said to have taken place between September 2016 and September 2018.
It's worth noting that Me Bank has yet to have its day in court.
About the BOQ share price
Since the end of May, Bank of Queensland shares have lost another 1%, and are going for $8.87 at the time of writing, up 0.05% for the day. That share price gives BOQ a market capitalisation of $5.69 billion, a price-to-earnings (P/E) ratio of 37 and a trailing dividend yield of 3.23%.
