Bank of Queensland announced Thursday that it had made a $250 million statutory net profit after tax for the financial year ended August 31, up 88 per cent from a year ago, when its bottom line had been hit with a $170 million writeoff of goodwill.
The bank's cash earnings fell seven per cent to $358 million, while its net interest margin climbed six basis points to 1.7 per cent.
Its home loan lending for the year dropped to $4.6 billion, down eight per cent from 2024/25, but it is planning to grow that business through its two digital-only brands, ME and Virgin Money.
"As we've talked over previous periods, we step back while the economics weren't working for us in that mortgage portfolio," managing director and chief executive Rod Finch told analysts.
"With those big structural and transformation pieces now in place, we're more confident stepping back into the market."
In August, 88 per cent of all of Bank of Queensland's home loans were originated through its digital channel, which the bank expects will cut its mortgage originating and servicing costs in half, compared with heritage home loans.
MST Marquee analyst Brian Johnson said that Bank of Queensland's ME brand had been basically matching Macquarie with the most aggressive interest rates for owner-occupiers in the market.
In recent years Bank of Queensland has been closing branches and converting all of its owner-managed branches to corporate branches to simplify its business.
It now has 102 branches across Australia, down from 147 three years ago.
Over 2025/26 it finished migrating all of its 350,000 ME customers to a new cloud-based platform built by French tech giant Capgemini, which Bank of Queensland says will provide customers with a better banking experience and improved protection from scams.
While most customers were migrated smoothly, the bank's annual report acknowledges that some experienced "disruption, inconvenience and frustration" during the process.
It also sold its $3.7 billion equipment finance loan portfolio to Challenger in April, in a bid to further simplify its business and free up capital.
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