Bendigo and Adelaide Bank's presence in the South Australian market took a big hit last year as depositors switched their savings to other banks.Disclosures in the company's latest annual report show that deposits held at branches in South Australia and the Northern Territory fell by A$579 million or 9.7 per cent in the year to June.The slide means that SA is now the bank's fourth largest state market for deposits behind Victoria, NSW and Queensland.Bendigo also reined in lending to South Australian borrowers, with total gross exposures in the state falling $471 million or 6 per cent to $7.2 billion.Although the bank expanded its national mortgage book by more than $1.6 billion last year, it slashed business lending across the country.Bendigo cut its gross exposures to borrowers in the hospitality, education, construction, manufacturing and financial services industries.The cuts to business lending were deeper than the growth in mortgages, with the result that total lending declined by $100 million.The bank's directors also warned shareholders in the annual report that its costs in relation to 'fee for no service' issues could be higher than the $1.2 million already flagged to the market.Bendigo made a provision of $1.2 million to cover compensation expenses for customers who were acquired by the bank when it bought the Wheelers Financial Services business.However, it appears that the bank has discovered other cases where fees were charged without services being provided in its Bendigo Financial Planning arm."The group did raise a provision for $1.2 million for compensation costs, relating to customers acquired through the business acquisition of Wheelers Financial Services in relation to fee for no service failings," directors stated in the annual report."However, work is continuing on other remediation programs impacting Bendigo Financial Planning, and as such is not in a position to reliably estimate the impact of any resolution and therefore a provision has yet to be raised for any compensation costs."