Bank of Queensland reported an 8 per cent fall in cash earnings for the first half of the 2019 financial year, citing various market challenges.

Among them are roadblocks with its franchising model, as it struggles to source new owner-managers in a post-royal commission environment.

BOQ is one of the few banks in the country that operate a franchise network, which was traditionally one of its selling points.

“In our branch network, starting seven years ago, we significantly increased risk requirements. In the Hayne environment, this has clearly been the right thing to do,” said chief executive Anthony Rose.

“Combining this with the overlay of uncertainty for owner-managers, driven by the focus on incentive arrangements through the Sedgwick review, the royal commission and mortgage broker remuneration changes, it has been difficult to attract prospective owner-managers to supplement the network for natural attrition.

“From FY20, we are shifting to a new, simplified value-share structure, which will make the model more attractive for owner-managers and will be better aligned to customer and shareholder outcomes.”