The Bendigo and Adelaide Bank Ltd (ASX: BEN) share price is under the spotlight today on news of an AUSTRAC investigation.
Bendigo Bank is one of the largest banks in Australia outside of the big four ASX bank shares. It has a community focus, donating money to local groups. The bank also owns digital challenger Up Bank.
AUSTRAC investigation
A few weeks ago, the bank made an ASX announcement regarding anti-money laundering and counter-terrorism financing (AML/CTF) “deficiencies”.
In today’s announcement, Bendigo Bank said AUSTRAC (Australian Transaction Reports and Analysis Centre) has identified “serious potential contraventions of the AML/CTF Act and has commenced an enforcement investigation.”
AUSTRAC has a wide range of possible enforcement actions and has not yet made a decision regarding the appropriate regulatory response, including whether enforcement action will be taken.
Bendigo Bank said it continues to work on uplifting its approach to risk management, particularly the non-financial risk and “acknowledges the need to intensify its efforts”.
The bank said that cost estimates will be provided to the market when they are determined.
The Bendigo Bank Chair Vicki Carter said:
The Bank recognises robust risk management practices are critically important to ensure the Bank can continue to protect its customers and deliver on its purpose of feeding into the prosperity of customers and communities.
Bendigo Bank CEO and Managing Director Richard Fennell said:
Bendigo Bank has taken a number of steps to improve its risk capability and strengthen its risk culture over the last 12 months however I recognise the need to intensify our focus and our efforts.
APRA capital charge
Additionally, Australian Prudential Regulation Authority (APRA), the prudential supervisor, has decided to apply a $50 million operational risk capital charge on the bank.
This will be starting from 1 January 2026. The capital charge is expected to reduce the bank’s level 2 common equity tier 1 (CET1) ratio by approximately 17 basis points (0.17%).
Bendigo Bank noted that as at 30 November 2025, the bank’s CET1 ratio was 11.19% and remains “well above the board’s target and APRA’s definition of ‘unquestionably strong’.”
Is the Bendigo Bank share price a buy?
The market appears to largely have been expecting this news because the bank is only slightly down.
Considering the bank is down by around 20% in 2025 to date, it’s a lot cheaper. But, I’m not convinced this is a great time to buy because we still don’t know what AUSTRAC’s punishment will be.
Bendigo Bank is a decent bank, but it’s in a very competitive space, making it hard to grow profit due to market share and pricing headwinds.
There are other ASX dividend shares I’d buy first for my portfolio.
