Bank of Queensland (BOQ) Share Trading Update

Submitted by Craig Strzelecki on 20 March, 2007 - 17:31

Bank of Queensland (BOQ) has a downgraded share trading recommendation of Hold (from Buy) from analyst Citigroup Investment Research. The analyst has downgraded their call after a 10% increase in the share price since 28/02/07 and the emergence of a play for Bendigo Bank (BEN). If BOQ and BEN do merge they would end up with a strong eastern seaboard footprint of 575 branches, with highly satisfied (currently) but under-penetrated customer base. Effectively it marries a deposit gathering community-based versus entrepreneurial salesfocussed growth strategy – which may prove management's sternest challenge. An opportunistic bid, given a favourable relative share price movement of 18% in the past month. The deal requires synergies to exceed the enunciated $70m (about $100m) in order to deliver an EPS neutral/accretive outcome by '08/09. Basel II makes life tougher for smaller banks and attractive dance partners are scarce. On balance the analyst favours that the deal will occur, with retail shareholders likely to approve a consenting partnership. HBOS, SGB and to a lesser extent Rabobank loom as the most likely candidates to scuttle this bid, or alternately take out the post-integration combined entity. The proposed deal may encourage BOQ management to pull out a favourable result on April 4, given the pending potential capital raising.

Bank of Queensland Limited is listed on the Australian Stock Exchange (ASX) under stock code BOQ. You can view their investor website here. BOQ was listed on the ASX on 24 August, 1971. Neil Roberts is the chairman and David Liddy is the managing director. The company is involved in banking, financial and related services. Find out the meaning of the recommendations in this primer. Browse for other stockbroker recommendations. You can use Instalment Warrants to trade BOQ. Check your charts and good luck with your share trading!

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