CommBank $3.78m Profit in 6 Months

Submitted by Share Trading on 13 February, 2013 - 13:43

Australian banking giant, CommBank (ASX:CBA) has released its first half profit results to December 31.

  • CBA $3.78 billion half year net profit.
  • CommBank shares jumped $1.85 on the announcement, or 2.7 percent, a new record high of $67.37 per share, Commonwealth Bank market capitalisation at $108 billion.
  • CommBank is Australia's biggest lender, having one in every four home loans, or 25.1 percent of the home loan market in Australia.
  • CBA wrote $1.54 billion in new mortgages in the first half period, an increase of 15 percent on the previous corresponding period. Mortgage brokers were responsible for 38 percent of the new loans for this period.
  • CBA retail banking arm income increased by 13 percent, adding $1.5 billion to the total result
  • The Bank's Return on Equity (ROE) was at 18.1 percent.
  • The company also raised $13 billion in capital from global funding markets, with net interest margin of 2.1 percent.
  • CommBank Chief Executive Officer Ian Narev said "Since reporting our full year results in August last year we have seen some improvements in the global macroeconomic environment,” Narev said in the statement today. “If the current stability continues, we believe it will translate into a slow but steady rebuilding of consumer and business confidence in Australia."
  • Interim dividend has been increased by 20 percent to $1.64. Ex-Dividend date is at 18th February 2013 and is fully franked.
  • CBA chief financial officer David Craig said, "Deposit competition is still strong. It's that competition more than anything that is underwriting the costs. So, it is good for our 10 million deposit customers - this is a real benefit. But for our 1.6 million mortgage customers they have to pay for the cost of funding."
  • CBA's chief executive Ian Narev said," In each of the major areas of concern – European Union stability, US recovery and China's on-going growth - developments have been positive overall," he noted in the report. As a result, we have experienced a period of relative stability, which has had a positive impact on global equity and debt markets. In particular, there is still no sustainable long-term plan for resolving sovereign indebtedness in Europe, and the US recovery remains fragile," he observed. And the long term effects of the strategies of overseas central banks to restore stability are uncertain."