Australia's Commonwealth Bank first-half profit up 1.7 pct

Dimity Hirst

Dimity Hirst

Australia's largest financial firm Commonwealth Bank on Wednesday said profits fell six percent in the last six months of 2018 amid a "challenging environment" for the business.

Cash earnings from continuing operations rose to A$4.68 billion ($3.38 billion) for the six months ended December 31, compared with A$4.60 billion a year ago, and lower than an A$4.75 billion estimate by six analysts polled by Reuters.

"Momentum appears to be slowing as the housing market rolls over", Mr Mott wrote.

CBA said its net interest margin dipped to a still sold 2.10%, 6 basis points lower than the first half of 2017-18, because of "higher funding costs and home loan switching and competition".

With credit growth tipped to fall, and profit margins under pressure, chief executive Matt Comyn signalled the bank would seek to keep a tight leash on costs, targeting a cost-to-income ratio of less than 40 per cent, compared with 42.6 per cent now.

Memphis Grizzlies to trade Marc Gasol to Toronto Raptors
Valanciunas, 26, has been the Raptors' starting center and has compiled season averaged of 12.8 points and 7.2 rebounds. The Charlotte Hornets have been active in trade talk over the years, but they could make a splash this year.

Operating expenses of $5,289 million were down 3.1%, with "elevated risk, compliance and remediation costs offset by prior period one-offs".

"We see a continued up-tick in funding costs, you see that come through and weigh on our net interest margin in the first half", Mr Comyn said.

CBA's interim dividend per share reported flat at $2.00, while the bank says their dividend reinvestment plan is anticipated to be satisfied in full by an on-market purchase of shares.

"We are already making the necessary changes and will be a better bank as a result", he said.

Recommended News

We are pleased to provide this opportunity to share information, experiences and observations about what's in the news.
Some of the comments may be reprinted elsewhere in the site or in the newspaper.
Thank you for taking the time to offer your thoughts.