Commonwealth Bank posts $10.9bn profit as Matt Comyn reveals home loan applications plunge 15 per cent

Commonwealth Bank has reported $10.9bn in annual profit in its full-year results, surpassing expectations as its loans and deposits portfolio continues to expand.

On Wednesday, CBA reported its cash profit had increased by 7 per cent, with its operating income growing by 6 per cent.

This was driven by the CBA’s home loans, business loans, consumer lending and household and business deposit schemes.

The bank’s chief executive Matt Comyn said the Australian economy was resilient but said

“growth is slowing, with higher interest rates and inflation placing uneven pressure on household incomes and economic activity”.

CommBank, Australia’s biggest home mortgage lender, said the bank’s number of home loan applications dropped 15 per cent since May, when the Albanese government announced contentious negative gearing tax changes.

Loan applications have also dropped 17 per cent from the same time last year.

Earlier this week, Westpac said it was experiencing a fall in home loan applications.

“Housing activity has softened from a high base,” Mr Comyn said.

“Application volumes appear to have stabilised in recent weeks. Businesses continue to manage higher input costs and supply uncertainty.”

The market predicted CBA’s full-year profits of about $10.85bn, with CBA raising its dividend to $2.70, up from $2.60 last year.

Despite the booming profits, CBA reported a drop of 0.03 percentage points in its net margin profit, which sits at 2.05 per cent.

The bank reported its operating expenses had increased by 6 per cent to $13.76m, which it said was driven by “inflation, investment in technology, fraud scams and financial crime, partly offset by productivity initiatives and favourable foreign exchange”.

More to come...