Today is a big day for Bank of Queensland Ltd (ASX: BOQ) shares.
Not because shares in the S&P/ASX 200 Index (ASX: XJO) bank stock are up 1.2% at $6.98 apiece, outpacing the 0.8% gains posted by the benchmark.
Rather, today is the day the bank holds its annual general meeting (AGM).
Here's what that company's top brass had to say.
Bank of Queensland shares in focus amid AGM
Chairman Warwick Negus kicked off the meeting, noting that "2024 has been a momentous year" for Bank of Queensland shares, with the company marking its 150th anniversary.
"That's 150 years of serving the community, funding the growth aspirations of businesses and assisting households to achieve their home ownership and personal savings goals," he said.
Turning to the business, Negus said FY 2024 "was critical in resetting the group for long term success".
Our strategy of building a simpler, specialist bank that meets the evolving needs of our valued customers, provides a better people experience and strong returns for our shareholders, is well progressed.
And he pointed out that the past financial year wasn't easy for Bank of Queensland shares, despite the stock gaining 24% over the past 12 months.
"The financial landscape for FY 2024 remained challenging with continued margin compression, high inflation, and elevated competition for deposits," he said.
With a nod to the bank's success in navigating these challenges, he noted:
We ended the year with a CET1 [Common Equity Tier 1] ratio of 10.7%, and the Board determined to pay a fully franked dividend of 17 cents per share, being a full year dividend of 34 cents per share, which is a yield of 5.4% on the year end share price.
On the risk management front, Negus said the bank had agreed to a court enforceable Remedial Action Plan this year. "Importantly, we are committed to getting the risk transformation right."
And he took a swipe at recent media reports relating to a potential new bank levy.
Noting the concern expressed by Bank of Queensland shareholders, Negus said:
BOQ supports well-considered policies with thorough consultation, that will support Australians, particularly those experiencing vulnerability and their unique need for both physical branches and access to cash.
However, the proposed levy as reported is inequitable and disproportionate, affecting mid-tier and international banks, potentially hindering competition, productivity and innovation.
A word from the CEO
CEO Patrick Allaway took to the podium next.
Addressing his positive outlook for Bank of Queensland shares, Allaway said, "We are transforming to a simpler specialist bank with a superior customer experience on our new banking platform and a more optimistic outlook for shareholder returns."
He noted that during a challenging and transformational FY 2024, the bank delivered cash earnings after tax of $343 million and statutory net profit after tax of $285 million.
And expense growth came in below inflation, with the bank reporting 2.9% growth in underlying costs.
In a promising trend, the bank's net interest margin stabilised in H2 FY 2024 after three consecutive halves of decline.
"We again stood back from uneconomic home lending and prioritised economic return over growth," Allaway said.
Commenting on the bank's digital aspirations, he added:
The foundational build of our end-to-end digital bank is largely complete. We now have over 400 thousand active digital customers on the new digital banking platform and are in the process of migrating ME customers, targeting the decommissioning of the ME heritage bank in FY 2026.
Looking at what could impact Bank of Queensland shares in the months ahead, Allaway concluded:
Our outlook for FY 2025 remains unchanged from our commentary at the FY 2024 results. We are targeting broadly flat total cost growth in FY 2025 and an uplift in revenues from the growth in our business bank and the owner manager conversion in the second half.
