Despite a slowing economy, Commonwealth Bank has announced the largest profits ever seen from an Australian bank.
The bank’s profit of $7.8 billion represents a 10% increase on the previous year’s figures of $7.11 billion, while net profit figures showed an 8% increase from last year.
The results were higher than the market expected, which had foreseen a cash profit increase of roughly 7%.
The bank’s subsidiary, Bankwest, also registered a rise in net profit of 6%.
The increase in profit at CommBank was supported by high customer satisfaction and strong performance in its institutional banking division.
A recent poll of 20,000 businesses by DBM Consultants saw CommBank end the financial year with the highest average satisfaction rating of the big banks, at 7.4%.
These ratings would have been influenced by the ability of business customers to discuss their needs with their bank and a swift return of their calls, said Dhruba Gupta DBM’s managing director (read more).
CommBank said the results would push shareholder dividends up to $3.64 per share, the bank announced – almost double the final dividend of $1.97 offered in the previous financial year.
Ian Narev, CommBank’s chief executive, said the bank’s hard work on improving performance and productivity had delivered positive results for shareholders, but warned that it still faced challenges in the current economic climate.
"Our primary areas of economic focus are the level of confidence of Australian business and households, the impact of economic conditions in China on the demand and price for resources, the value of the Australian dollar and the resultant impact on export-sensitive parts of the Australian economy and the stability of funding markets," he said.
"Indicators relating to all of these factors have been mixed over the past six months, and we expect that to remain the case in the near term."
James Booker
Which4U
If you enjoyed this article, check out the latest articles on our Finance Blog.
