Brokerages mixed on Australia's Bendigo and Adelaide Bank post-RACQ deal

Bendigo and Adelaide Bank

04/12/2025 19:22

Updates

** Brokerages offer divided views on Bendigo and Adelaide Bank BEN.AX after the regional lender on Thursday announced agreement to buy RACQ Bank's retail lending assets and deposits

** Morningstar keeps fair value estimate unchanged at A$11 per share

** Prefer the strategic merit, increased low-cost deposits, a low-credit-risk home loan book, leveraging the existing Bendigo cost base, and not paying a premium to book value - Morningstar

** Investment research firm says RACQ Bank acquisition adds nearly 4% to FY27 loan and deposit forecasts and around 5% to profit from FY28

** Jefferies, however, says while the RACQ deal is expected to be modestly accretive for returns, it comes at a time when management focus is likely to be drawn to its anti-money laundering issues

** Brokerage retains "underperform" tag, price target A$9.53

 ** We continue to believe Bendigo will struggle to meet its return-on-equity targets, despite recent initiatives - Jefferies

** Stock has fallen 22.7% this year, as of last close

(Reporting by Roshan Thomas and Nikita Maria Jino in Bengaluru)

((Roshan.Thomas@thomsonreuters.com))