While Bank of Queensland's strong growth in income, tight cost control and stock price discount appeal to some analysts others are concerned about its asset quality and difficult funding profile. All agree the stock is cheap (it is trading at a price-earnings discount of 15 per cent or more to its peers) but they are divided on whether it is a buy. Macquarie Equities, which has a neutral recommendation on the stock, described BOQ as "messy". Margin increase and cost performance were the highlights, while asset quality was a concern.Macquarie said: "We expect that impairment charges will normalise less rapidly than originally anticipated, predominantly driven by non-performing business and line-of-credit loans."Macquarie has downgraded its earnings forecasts for the 2011/12 and 2012/13 financial years, citing its doubts about the bank's ability to grow in a low credit growth environment. It says the bank will incur higher costs as it develops its insurance business. It reduced its target price on the stock from $10.70 to $8.70 (the stock closed at $7.87 on Friday).Citi, which also has a neutral recommendation on the stock, said: "Bank of Queensland is the cheapest but also most challenged of the commercial banks."Citi also cut back its earnings-per-share estimates for the current financial year and 2012/13. It said BOQ had the worst credit quality of any listed Australian bank. Its mortgage arrears rates are five times the industry average. Citi said: "Rising arrears across the portfolio do not convince us that they are out of the woods yet."Citi described BOQ's funding profile as "unsustainable" and said it would like to see the bank increase its deposit funding from the current level of 52 per cent to around 80 to 90 per cent. It has a target price of $7.10 on the stock.Goldman Sachs has a more positive view on the stock, which it rates a buy with a target price of $9.50. Analyst Ben Koo said he liked the strong growth in revenue (before bad debt charges) and the big price discount on the stock.Koo is less concerned about the bank's bad debts and arrears than other analysts. He said: "While the arrears do cause some concern, Bank of Queensland has put collection strategies in place in efforts to mitigate the rising trend. In addition, forward indicators are supportive of bad debts normalising, with new individual impaired loans down significantly over the second half."Deutsche Bank has a similar view. Its note on the result highlighted the bank's strong underlying earnings growth and the "normalising" of bad debts. It has the stock as a buy with a target price of $9.50.