Bank of Queensland retail raising reaps $90m

The Bank of Queensland had raised $90m from retail shareholders, adding to a $250m institutional placement earlier in December Picture: AAP

Bank of Queensland has raised nearly four times as much capital from retail investors as it had planned after completing an oversubscribed share placement plan.

BoQ on Monday said it had raised $90m from retail shareholders, adding to a $250m institutional placement earlier in December.

While the bank had only been seeking to raise $25m from retail investors, the extra capital has taken the bank’s total raising to $340m, with the proceeds to be used to strengthen its balance sheet and add to its capital buffers above the ratio required by regulators.

Shares will be issued at a 2 per cent discount to the five-day average volume-weighted price, at $7.27 each. BoQ opted to accept all applications made under its retail offer rather than scale back the raising after almost 7000 investors flooded the offer.

The strong raising comes just weeks after the lender unveiled a 14 per cent slump in cash earnings to $320m for the 2019 financial year, while warning that the current year would also be a “difficult” one. The poor earnings result was driven by slowing credit demand, lower interest rates, a rise in regulatory costs and an increase in bad debts. BoQ’s net interest margin eroded by five basis points to 1.93 per cent and its CET1 capital ratio fell 22 basis points to 9.04 per cent.