Suncorp shareholders will again receive a special dividend this year, after the financial conglomerate said it would hand back surplus capital to investors.
Late on Wednesday Suncorp said it was planning to pay a higher-than-expected final dividend of 30¢ a share, plus a one-off sweetener of 20¢ a share.
It making the after-market announcement it said profits were expected to be between $480 million and $500 million for the year to June, a significant fall on last year. The main reason for the decline was a loss-making deal to offload $1.6 billion in bad loans to Goldman Sachs for 60¢ in the dollar.
All up, shareholders will receive dividends of 75¢ a share for the full year, up from 55¢ last year, and slightly above what analysts had been betting on.
Chairman Ziggy Switkowski said it was "pleasing to reward loyal shareholders and return some of the capital raised during the global financial crisis", after it also paid a special dividend last year.
The surprise announcement was made after Suncorp finalised the sale to Goldman, and the company will provide a formal financial result on August 21.
Across its banking and insurance divisions, the Queensland-based company had mixed results.
While the dividend is likely to grab attention in the market, it also highlighted the deteriorating con- ditions in its life insurance business, where it expects profits to plunge to $60 million, down from $251 million last year.
Life insurers have been hit by falling profits because of increased payouts and the fact more people are not renewing policies in a weak economic environment.
In general insurance, where Suncorp owns brands including AAMI, GIO, Apia and Shannons, profits were expected to jump to between $870 million and $890 million, up from $493 million last year.
Rival insurer IAG also said in July that it was on track to beat previous profit guidance, after benefiting from relatively few claims from natural disasters in the last six months.
In Suncorp's banking division, the "core" bank made a profit between $280 million and $300 million, against $289 million last year. The "non-core bank", where it has housed troubled commercial loans, made a loss of about $630 million after the deal with Goldman.
These loans had been a weight on the group. It has been running down the portfolio of bad debts since 2009 and in June it finalised a plan to offload some of the loans to Goldman and wind down the rest of the portfolio over the next year.
Chief executive Patrick Snowball said net profit from Suncorp's core businesses had risen 20 per cent, and this had been taken into account in setting the final dividend, as well as excess capital.