💰 Tower Limited (ASX: TWR): The Quiet Dividend Hero You’ve Probably Overlooked
Tower Limited (ASX: TWR) might not be the first name that springs to mind but it should be. Trading at just $1.40, this small-cap general insurer from New Zealand is delivering some of the biggest income yields in the market, backed by strong fundamentals and a digital-led business model that’s quietly reshaping regional insurance.
Tower isn’t your average legacy insurer. Operating across New Zealand and the Pacific Islands (including Fiji, Samoa, and the Cook Islands), Tower has embraced a fully digital insurance platform slashing costs, simplifying claims, and improving customer acquisition across its niche markets.
đź’¸ Yield That Turns Heads
Here’s where it gets exciting:
- Current share price: $1.40
- Dividend yield (fully franked): 8.09%
- Latest interim dividend: $0.07 per share
- Forecast FY2025 dividend: $0.16 per share, up from $0.097 in FY2024
Tower is forecast to lift EPS from $0.20 in FY2024 to $0.274 in FY2025, a 37% year-on-year increase. Even with a slight pullback in FY2026 (to $0.179), guidance suggests earnings will rebound again into FY2027.
Tower’s recent results indicate strong all-round performance, with key business areas delivering solid momentum.
âś… Return on Assets saw a significant rise from 0.35% to 10.99%
âś… The net profit margin saw a significant rise, 0.42% to 14.66%.
âś… Debt-to-Equity Ratio: a conservative 8.01%
🧠What’s Ahead? FY2025 Outlook & ESG Momentum
Tower has revised its FY2025 profit outlook upward to NZD 60–70 million, driven by stronger underwriting results and increasing traction across its digital platforms. By FY2027, it plans to grow gross written premiums (GWP) by 15%, supported by:
- New product launches
- Deeper digital penetration
- Regional market expansion
Tower Limited might be small in size, but it’s big on discipline, digital innovation, and dividends. It’s rare to find an insurer offering:
- Above-market dividend yield
- Strong growth in earnings per share
- Low gearing and improving capital efficiency
For income-focused investors, Tower stands out as a rare blend of yield + growth, operating in a defensive sector with high predictability and cash flow visibility.
💵 BSP Financial Group Ltd (ASX: BFL) – A High-Yield Dividend Engine in the Pacific
BSP Financial Group Ltd, headquartered in Port Moresby, is the dominant financial institution across the South Pacific, operating in nine countries including Fiji, Tonga, Samoa, Solomon Islands, and Cambodia. Offering a full suite of services from retail and corporate banking to insurance, funds management, and FX BSP leverages its regional breadth to deliver stable, diversified earnings in markets often overlooked by global competitors.
BSP offers a compelling 6.85% fully franked dividend yield, backed by a full-year payout of $0.39 per share. In FY2024, the group delivered PGK 1.08 billion in net profit before extraordinary items (up 21% YoY) and PGK 1.98 billion in net interest income (up 19%)  a result of strong loan growth and disciplined credit controls.
BSP anticipates continued loan book expansion across both retail and corporate segments, with PNG and Fiji leading growth. The bank is investing in digital platforms and branch upgrades, aimed at improving operating leverage and customer experience. With a debt-to-equity ratio of just 5.8% and a strong capital position, BSP remains well placed to sustain high dividend payouts while navigating regional uncertainties.Â
For income-focused investors, BSP combines rare yield strength with real earnings momentum. With expanding profitability, minimal leverage, and a long track record of capital discipline, BSP is more than a regional bank it's a Pacific dividend engine poised to deliver both income and moderate long-term growth.
(Source: Company Announcements)
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