Commonwealth Bank’s quarterly profit dips to $2.7b
Commonwealth Bank made cash profits of $2.7 billion in the March quarter, up four per cent on the previous year but down one per cent on the first half quarter average.
Operating income was flat in the three months to 31 March and underlying net interest margin was broadly stable.
CBA spent $3.36 billion on operating expenses, up one percent on average from the first half; This reflects higher cloud computing volumes, software licensing and investment in AI capabilities.
It incurred loan impairment charges of $316 million with higher provisions reflecting increased geopolitical and macroeconomic uncertainty, but actual losses remained low and underlying portfolio credit quality was solid.
“Our balance sheet settings remain resilient with strong levels of capital, liquidity and deposit funding in the context of economic and geopolitical uncertainty,” Chief Executive Matt Comyn said.
During the quarter, the percentage of consumers who were more than 90 days delinquent on their personal loans rose to 1.71 percent, up from 1.51 percent in the December quarter and the highest since before the pandemic.
CBA said this reflects both seasonal factors and CBA’s deliberate decisions involving credit, pricing and purchasing mix.
The percentage of consumers using mortgage loans and credit cards remained low and generally stable at 0.69 percent and 0.68 percent, respectively.
Mr Comyn said the Australian economy continued to demonstrate resilience but supply chain disruptions, higher prices and interest rates were expected to put pressure on household spending and business activity.
“We will continue to adjust our settings as appropriate and remain focused on executing our strategy,” he said.
CBA gained market share in business loans and household deposits during the quarter, while its growth in home loans also kept pace with the market.
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