The sustainability of the dividend payout ratio at Bendigo and Adelaide Bank and the prospect of the bank seeking capital to support above-system growth in lending both featured in discussions at the investor briefing for the bank's interim profit.Yesterday, the bank reported a net profit of A$173.9 million for the six months to December 2010, up two-thirds on the corresponding half in 2009. Cash earnings increased 16 per cent, to $162.1 million.Management suggested the result was fairly boring, but the full complement of sell-side analysts that now follow the bank seriously (given Bendigo is now the fifth-largest listed bank) made the payout and capital projections the core of their questions.Richard Fennell, the bank's chief financial officer, said that, assuming system growth in credit is "mid to high single digits, when we look at that and the organic capital growth that we think we can generate then we're quite comfortable to be still in that 65 per cent to 70 per cent payout ratio."The thing that actually has more impact potentially is DRP [dividend reinvestment plan] participation, but, really, from what we can see going forward, we're very comfortable that we're not going to be needing to go back to the market asking for capital, and, I'm assuming, organic growth."Brian Johnson, from CSLA, suggested to management that "the implication is that at some point it could cause capital shock or dividend shock, and you've got a lot of questions kind of hinting at that today."Mike Hirst, the bank's chief executive, responded that, "well, we don't have that fear".The composition of the earnings attracted some discussion at the briefing, mainly over the gain of $10 million or so from the revaluation of the bank's stake in the pool of properties financed under the HomeSafe equity release product for elderly customers.Of the four operating segments reported by the bank, retail banking increased its profit to $176 million, from $135 million over 12 months; third-party banking (basically the wholesale mortgage funding business) increased profits to $100 million from $97 million; Rural Bank (now wholly owned) recorded a fall in profits, to $27 million from $30 million, while the wealth business, including Sandhurst Trustees and some minor recent acquisitions, recorded a dip in revenue and profits.Of Sandhurst, the managing director, Mike Hirst, said, "That is an area that's probably been under-invested in on our part over the last few years." But, he said, he believed that, with the reforms following the Cooper review of superannuation, "the changes that will work their way through that section will be extremely positive for anyone who's got a branch distribution network, so we think the opportunities are there for further investment."