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Investor glossary

Australian Accounting Standards (AAS)
Refers to the Australian Accounting Standards issued by the AASB. An accounting standard is an Australian Accounting Standards (AAS) technical pronouncement that sets out the required accounting, including measurement and Australian Accounting Standards (AAS) recognition requirements, for particular types of transactions and events. The accounting Australian Accounting Standards (AAS) requirements affect the preparation and presentation of an entity’s financial statements.

Australian Accounting Standards Board (AASB)
The Australian Accounting Standards Board (AASB) is the Australian Government agency Australian Accounting Standards Board (AASB) responsible for developing, issuing and maintaining accounting standards that apply under Australian Accounting Standards Board (AASB) Corporations Act 2001.

Australian Prudential Regulation Authority (APRA)
Is the prudential regulator of the Australian financial services industry. APRA is an independent Australian Prudential Regulation Authority (APRA) statutory authority that supervises institutions across banking, insurance and superannuation and Australian Prudential Regulation Authority (APRA) promotes financial system stability in Australia.

Australian Prudential Standards (APS)
Refers to the Prudential and Regulatory Standards issued by APRA.

Authorised deposit taking institution (ADI)
A body corporate which is authorised under the Banking Act 1959, to carry on banking business Authorised deposit-taking institution (ADI) in Australia. It includes banks, building societies and credit unions.

Bonus Share Scheme
The Bonus Share Scheme was terminated in April 2023. The final offering occurred in December 2022.

Cash earnings
Cash earnings is not a statutory financial measure, is not presented in accordance with Australian Accounting Standards, and is not audited or reviewed in accordance with Australian Auditing Standards. It is considered by management to be a key indicator of the underlying performance of the core business activities of the Group. Cash earnings is defined as statutory net profit after tax adjusted for non-cash items and other adjustments. Non-cash items are those deemed to be outside of the Group’s core activities and hence these items are not considered to be representative of the Group’s ongoing financial performance.

Committed Liquidity Facility (CLF)
The RBA makes available to Australian Authorised Deposit-taking institutions a CLF that, subject to qualifying conditions set and approved by APRA, can be accessed to meet LCR requirements under APS 210 Liquidity.

Common Equity Tier 1 Capital (CET1)
The highest quality of capital available to the Group reflecting the permanent and unrestricted commitment of funds that are freely available to absorb losses. It comprises ordinary share capital, retained earnings and reserves less specified regulatory adjustments.

Cost to Income ratio
A performance measure which represents total operating expenses before noncash items and other adjustments as a percentage of total income before non-cash items and other adjustments.

Credit Risk
The risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation.

Dilutive earnings per share
An earnings measure calculated by dividing net profit after tax attributable to owners of the Bank by the weighted average number of fully paid ordinary shares on issue over the period adjusted for the effect of all potentially dilutive instruments.

Dividend payout ratio
Dividends paid on ordinary shares divided by net profit after tax attributable to owners of the Bank.

Dividend Reinvestment Plan
A plan which provides shareholders with the opportunity to convert all or part of their entitlement to a dividend into new shares.

Earnings per share
An earnings measure calculated by dividing net profit after tax attributable to owners of the Bank by the weighted average number of fully paid ordinary shares on issue over the period.

Expected Credit Loss (ECL)
Represents the probability-weighted present value of expected cash shortfalls over the remaining expected life of the financial instrument and considers reasonable and supportable information about past events, current conditions, and forecasts of future events and economic conditions that impact the Bank’s credit risk assessment.

Fair value
Is an amount at which an asset or liability could be exchanged between knowledgeable and willing parties in an arm’s length transaction.

Financial assets measured at amortised cost
Financial assets that are held within a business model whose objective is to hold assets in order to collect contractual cash flows; and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Financial assets measured at fair value through other comprehensive income (FVOCI)
Financial assets that are held in a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets. Changes in fair value are recognised in other comprehensive income.

Financial assets measured at fair value through profit or loss (FVTPL)
Financial assets that are not held in one of the two business models applicable to amortised cost or fair value through other comprehensive income are measured at fair value through profit or loss. Changes in fair value are recognised in the Income Statement.

Full time equivalent (FTE)
Includes all permanent full-time staff and part-time staff equivalents.

Equity Reserve for Credit Losses (ERCL)
The Equity reserve for credit losses was initially established to meet the requirements of APRA Prudential Standard, APS 220 Credit Quality, which required a reserve to be held to recognise estimated future credit losses which may arise over the life of the Group’s lending portfolio. This requirement was removed from 1 January 2022, however, the Group has prudently maintained this reserve pending further clarification.

Gross loans and other receivables
Is the principal amount of loans and advances provided, gross of provisions and deferred fee Gross loans and other receivables income and including any accrued interest.

Is Bendigo and Adelaide Bank Limited (‘the Bank’) and the entities it controlled at financial year end and during the financial year (‘the Group’).

Impaired loan
A facility must be classified as impaired regardless of whether it is 90 days or more past due (arrears) when there is doubt as to whether the full amounts due (interest and principal) will be achieved in a timely manner. This is the case even if the full extent of the loss cannot be clearly determined.

Liquidity Coverage Ratio (LCR)
The Liquidity Coverage Ratio (LCR) measures the portion of High Quality Liquid Assets (HQLA) available to meet net cash outflows over a 30-day period under an APRA defined severe short term stress scenario.

Net Interest Income (NII)
The amount of interest received or receivable on assets net of interest paid or payable on liabilities.

Net Interest Margin (NIM)
Net interest income divided by average interest-earning assets. This measure provides an indication of the profitability of the Bank’s interest earning assets less the cost of interest bearing liabilities (i.e cost of funding).

Net Stable Funding Ratio (NSFR)
The Net Stable Funding Ratio (NSFR) is the ratio of the amount of available stable funding (ASF) to the amount of required stable funding (RSF). ASF is the portion of an Authorised Deposit-taking Institution’s (ADI) capital and liabilities expected to be a reliable source of funds over a one year time horizon. RSF is the function of the liquidity characteristics and residual maturities of an ADI’s assets and Off Balance Sheet activities.

Net tangible assets
Net assets excluding intangible assets and other equity instruments divided by ordinary shares on issue at the end of the period (excluding Treasury Shares deduction).

Non-performing loans
Are loans that have been recognised as either impaired or 90 days past due, consistent with the methodology in APS 220 Credit Risk Management.

Is the face value on which the calculations of payments for derivative financial instruments is based.

Offset account
An Offset Account (RCA) is a savings account which participates with a separate facility usually for a mortgage. Instead of receiving interest on the savings account, the interest payment due on the loan is calculated only on the net balance of the facility balance less the savings account balance.

Operating segment
An operating segment is a component of the Group that engages in business activities from which it earns revenues and incurs expenses. Segment reporting reflects the information that is used by the Managing Director for the purposes of resource allocation and performance assessment, hence it is consistent with the internal reporting provided to the Managing Director and the Executive Team.

Past due
A financial asset is past due when a counterparty has failed to make a payment of principal, interest or other amount, when contractually due.

Past Due 90 Days
For a loan subject to a regular repayment schedule:

  • At least 90 days has elapsed from the due date of a contractual repayment which has not been satisfied in full; and
  • Total amount of arrears is equivalent to at least 90 days worth of Scheduled Payments. For a loan not subject to a contractual repayment schedule (e.g. overdrafts and revolving credit facilities) the facility remains over the contractual limit amount for at least 90 days.

Restructured facility
A ‘Restructured Loan’ is a facility in which the original contractual terms have been modified to provide for concessions of interest, or principal, or other payments due, or for an extension in maturity for a non-commercial period for reasons related to the financial difficulties of a customer and would not be offered to new customers with similar risk.

Return on average ordinary equity (ROE)
Net profit attributable to owners of the Bank divided by average ordinary equity, excluding Treasury shares.

Return on average tangible equity (ROTE)
Net profit attributable to the owners of the Bank divided by average ordinary equity, excluding Treasury shares less goodwill and other intangible assets.

Right-of-use-asset (ROUA)
The right-of-use asset is a lessee’s right to use an asset over the life of a lease.

Rights to ordinary shares in Bendigo and Adelaide Bank Limited granted under Long Term Variable Remuneration award and subject to performance, service and risk gateway conditions.

Risk-weighted assets (RWA)
Assets calculated by applying a regulatory risk-weight factor, prescribed by APRA, to on and off-balance sheet exposures.

Share-based payments (SBP)
Arrangements whereby employees services are exchanged for equity settled instruments namely options or shares. These payments are accounted for under AASB 2 Share-Based Payments where, in relation to employees and key management personnel (KMP), the organisation receives in exchange for providing Equity instruments (including shares and share options) of the organisation with the ability to settle in cash at the Board’s discretion.

A non-bank entity established for a narrowly defined purpose, including for carrying on securitisation activities. The structure of the SPE and its activities are intended to isolate its obligation from those of the originator and the holders of the beneficial interests in the securitisation.

Term Funding Facility (TFF)
The Term Funding Facility (TFF) was established by the RBA in March 2020 to provide three-year term funding to authorised deposit-taking institutions (ADIs), to support lending to Australian businesses.

Total Capital adequacy ratio
Total capital divided by total RWA calculated in accordance with relevant APS.

Treasury shares
Are shares that the Bank has issued but are held by a trust included within the Bank’s consolidated results. Treasury shares are not considered shares outstanding and are not included in ‘per share’ calculations.

Weighted average number of shares
The calculation includes fully paid ordinary shares of the Bank and excludes treasury shares related to investment in the Bank’s shares.

Bendigo and Adelaide Bank acknowledges Aboriginal and Torres Strait Islander peoples as the First Peoples of this nation and the Traditional Custodians of the land where we live, learn and work. We pay our respects to Elders past and present as it is their knowledge and experience that holds the key to the success of future generations.

Bendigo and Adelaide Bank Limited, ABN 11 068 049 178 AFSL / Australian Credit Licence 237879. Any advice provided on this website is of a general nature only and does not take into account your personal needs, objectives and financial circumstances. You should consider whether it is appropriate for your situation. Information on this page can change without notice to you.
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