Commonwealth bank reports cash profit of $4.68 billion, missing expectations
Just days after being called out in the banking royal commission final report, one of Australia’s ‘big four’ banks, Commonwealth bank has reported its half year results
Commonwealth bank’s H1 cash profit was recorded at $4.68 billion, up 1.7% from the previous year. However, one of Australia's biggest banks has missed analysts' expectations despite the increase.
Analysts say higher funding costs and regulatory pressure played a part.
The bank reported its H1 operating income was $12.408 million, down 1.9%, due to volume growth offset by lower net interest margin, lower markets and fee income, and the impact of weather events.
The bank recorded its statutory net profit after tax (NPAT) was at $4.599 million.
While its net interest margin of 2.10%, was down 4 basis points from 2H18, due to higher funding costs and home loan switching and competition.
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.
The bank reported its earnings per share (cash basic) increased 0.9% to 265.2 cents.
Next steps after the royal commission
CBA has said on Wednesday it will work with regulators and the government to implement inquiry recommendations.
CBA has said the bank is "Working through the royal commission's final report and 76 recommendations"
It says it is implementing stronger policies and processes, including a new code of conduct.
Commonwealth Share price
Monday’s royal banking commission saw stocks of Commonwealth bank of Australia surge, but on Wednesday morning the surge ended, with the financial sector trading in the red on Wednesday morning.
Shares of Commonwealth Bank of Australia fell as much as 2.2 % to A$72.02 at time of writing.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
Please see important Research Disclaimer.
Seize a share opportunity today
Go long or short on thousands of international stocks.
- Increase your market exposure with leverage
- Get spreads from just 0.1% on major global shares
- Trade CFDs straight into order books with direct market access
Live prices on most popular markets
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.