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- Commonwealth Bank (CBA) saw a hefty spike on the Aussie stock market today following its latest half-year report
- The bank brought in a flat $12.5 billion in revenue and $4.48 billion in profit
- Though profits were 4.3 per cent down on the same time the year before, the bank outperformed market expectations
- To keep investors happy, the bank kept its interim dividend flat at a fully franked $2 per share
- Commonwealth Bank gained 4.08 per cent today, closing with shares worth just over $88 each — their highest price since May 2017
The biggest market cap on the Aussie share market, Commonwealth Bank (CBA), had its biggest gain of 2020 so far following its latest half-year report.
The big bank hauled in roughly $12.5 billion in revenue from July to December 2019, up a marginal one per cent on the same period the year before.
Statutory net profit after tax came in at $6.1 billion for the half-year, up 34 per cent on last year’s $4.6 billion. However, this figure is bolstered by the sale of CBA’s Colonial First State Global Asset Management business, which added just under $1.7 billion to the banking giant’s balance sheet.
Removing this one-off cash injection from the half-year profits brings the underlying net profit after tax figure to $4.48 billion — down 4.3 per cent on the year before.
Nevertheless, Commonwealth was tipped by analysts to report less than $4.35 billion in profit for the half-year, meaning the bank outperformed market expectations.
To keep investors happy, the bank also kept its interim dividend at a flat and fully franked $2 per share.
Commonwealth CEO Matt Comyn said the continued strong revenue and higher-than-expected profits were underpinned by growth in home lending and deposits.
“We helped more customers meet their financial goals, including $53 billion in new lending to home buyers and $19 billion in new business lending,” Matt said.
The bank has taken a hit from bushfire-related claims, according to Matt, but looking ahead seems to be in a safe position.
“The Australian economy is underpinned by good long-term fundamentals. Our population continues to grow, we have a strong trade and fiscal position, and a solid pipeline of infrastructure investment provides ongoing stimulus,” he said.
“Uncertainties remain about the global economic outlook, and we are mindful of the impacts of drought and bushfires. Against this backdrop, we are focused on investing in our core businesses and on continued execution.”
He said despite the increased claims from the local and international disasters so far this year, the bank is still positioned to provide more support to those impacted by the bushfires and the spreading coronavirus in the future.
Commonwealth Bank gained a hefty 4.08 per cent today, causing a ripple effect throughout the entire finance sector. Shares closed at their highest point since 2017 at $88.18 each. The company has a $156.1 billion market cap.
