Generous dividend maintained by Wide Bay

Wide Bay continues to pay out one of the most generous dividends of any bank or building society in Australia, with a dividend of 32 cents a share, or $10.1 million in all, to be paid to shareholders.

The building society reported a profit of $11.6 million for the year to December 2009, and up 20 per cent on the prior corresponding period in 2008.

Wide Bay's payout ratio is at least, on this occasion, 87 per cent. This time last year Wide Bay paid out more than 100 per cent of the profit as dividend.

The board operates a dividend reinvestment scheme with a discount of 7.5 per cent, so it can expect a reasonable proportion of the dividend to be reinvested. For the final dividend paid in October 2009 shareholders ploughed 29 per cent back through the DRP.

Wide Bay said its tier one capital ratio at December 2009 was 9.6 per cent and its total capital ratio was 12.0 per cent.

The Bundaberg-based mortgage financier reported growth in receivables of only three per cent over the year, to $2.2 billion, with new business now tapering off with the removal of the top-up grants on payment to first home buyers from the Australian government.