Suncorp could deliver the trifecta - Special dividends, buybacks and share consolidation in FY25

Note: This interview was taped Monday 19 August 2024, hours after Suncorp released its FY24 results to the market.

Suncorp (ASX: SUN) is one of the country's largest insurers alongside IAG and QBE. All three major insurers have seen some big headwinds over the last three years - soaring inflation, a challenging reinsurance market, and the impact of huge natural disasters to name a few. 

But Suncorp has had the additional challenge of running a consumer bank amid a structural slump in net interest margins. 

That is until Suncorp was finally able to sell its bank to ANZ for $4.1 billion on July 31. Management has already flagged that a portion of the capital earned from this sale will be returned to shareholders by the end of Q1 2025. In addition to the sale of its banking business, Suncorp has been able to reap the rewards of higher written premiums and solid returns from booming investment markets, the latter of which soared 47% year-over-year. 

Indeed, if there was any time to pay out a special dividend, it'd be right now. But, as Suncorp Group CEO Steve Johnston tells me in this sit-down interview, there will be much more than just a special dividend coming for shareholders. Johnston shares more about the company's plans for shareholders as well as his thoughts on the FY24 results in the following.

Timestamps

• 0:00 - Introduction
• 0:20 - What are the key figures investors should be aware of from this report?
• 0:53 - Pricing power and margins
• 1:47 - Unpacking the "reinsurance reset"
• 2:51 - How are Suncorp thinking about financial markets and the investment landscape?
• 3:50 - What dividend payout ratio can investors expect for FY25?
• 4:35 - Why was the sale of Suncorp's banking business to ANZ the best long-term outcome for shareholders?
• 5:58 - Any opportunities for additional capital return
• 7:04 - How will you know you've become a better insurer?
• 7:53 - What keeps you up at night?