How does the Bank of Queensland dividend compare to the other ASX 200 banks?

We dive into how the Bank of Queensland dividend ranks against the big banks.

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Key points

  • The Bank of Queensland board recently declared an interim dividend of 22 cents per share for FY22
  • Goldman Sachs estimates Bank of Queensland to pay 45 cents per share for its full-year dividend
  • This equates to a trailing dividend yield of 5.99%, which is higher than Bendigo Bank and ANZ's forecasted yields

The Bank of Queensland Ltd (ASX: BOQ) dividend received a significant boost following the company’s robust half-year results.

A bumper performance across key financial metrics reflected the strong business momentum, disciplined cost control, and improved portfolio quality.

Integration and strategic transformation were also on track and delivering results.

This led the company to give back to its shareholders, reflecting its consistent dividends policy.

Let’s see how the Bank of Queensland dividend stacks up against its rivals.

How does the Bank of Queensland dividend stack up?

Bank of Queensland is set to pay a fully franked interim dividend of 22 cents per share to eligible investors on 26 May.

However, according to Goldman Sachs, the bank is expected to declare a final dividend of 23 cents per share. This will bring the total FY22 dividend amount to 45 cents per share.

Based on the current Bank of Queensland share price of $7.51, this gives a forecast trailing dividend yield of 5.99%.

What about its competitors?

The company’s main direct competitors are Bendigo and Adelaide Bank Ltd (ASX: BEN) and the big four banks. They include Commonwealth Bank of Australia (ASX: CBA)Westpac Banking Corp (ASX: WBC)Australia and New Zealand Banking Group Ltd (ASX: ANZ), and National Australia Bank Ltd (ASX: NAB).

By comparison, Bendigo Bank rewarded its shareholders with a fully franked interim dividend of 26.5 cents per share.

Goldman Sachs estimates the bank to maintain its final dividend at 26.5 cents per share, bringing the full-year dividend to 53 cents.

Bendigo Bank shares are exchanging hands at $10.34, which gives it a dividend yield of 5.12%.

Another competitor in the sector, ANZ, is on track to distribute an interim dividend of 72 cents per share to shareholders on 1 July. The company’s forecasted final dividend for FY22 is predicted to be around 73 cents on Goldman Sachs’ watch.

This translates to a full-year dividend of $1.45.

Calculating using the last price of $25.59 for ANZ shares, this is a dividend yield of 5.66%. 

Comparing the Bank of Queensland dividend yield against its peers may be one point to consider when investing. However, it is important to also look at the total shareholder return for the past 12 months.

As such, Bank of Queensland shares have fallen 14% for the period, while Bendigo Bank’s have moved up 1%.

When looking at ANZ shares, they have dropped around 7%.

Are Bank of Queensland shares a buy?

A couple of brokers weighed in after the bank revealed its half-year financial performance in mid-April.

Goldman Sachs analysts believe Bank of Queensland shares still have a potential upside despite the broker cutting its 12-month price target. The broker slashed its rating by 5.1% to $9.34 for the company, which implies an upside of roughly 25%.

On the other hand, Credit Suisse also reduced its price target by 12% to $10.00 apiece. This represents an upside of around 34% from where the regional bank’s shares last traded.

On valuation grounds, Bank of Queensland commands a market capitalisation of roughly $4.8 billion.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Bendigo and Adelaide Bank Limited. The Motley Fool Australia has recommended Westpac Banking Corporation. 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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