CBA half-year profits fall, but bank chief confident about recovery
Commonwealth Bank of Australia (CBA) has posted a $3.9 billion half-year cash profit, a 10.8 per cent fall on the same period last year.
The nation's largest lender attributed the result to the effects of the coronavirus pandemic but said the Australian economy was well placed for recovery.
The bank's statutory bottom-line result was $4.9 billion, a drop of 20.8 per cent.
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The CBA has recorded a half-year dip in profits but CEO Matt Comyn said the Australian economy was fundamentally strong. AAP
"Australia is relatively well positioned having started from a position of fiscal and economic strength," Matt Comyn, CBA chief executive, said.
"We have a solid pipeline of infrastructure projects, the outlook for mining and agriculture is strong, and the community has benefited from the government's significant income support measures."
CBA's net interest margin - the profit from loans - reduced by 10 basis points to about 2.5 per cent in the first half, after historically low lending rates.
And funds the bank had allocated for bad loans rose to $882 million.
Mr Comyn said the economic outlook for some industry sectors remained a concern.
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The aviation sector remains a vulnerable part of the economy and for corporate lenders. Getty
"Although the outlook is positive, there are a number of health and economic risks that could dampen the pace of recovery," he said.
He said corporate loans in the aviation, entertainment and leisure and tourism sectors -all hit hard by the pandemic - were still vulnerable.
CBA will pay its investors an interim dividend of $1.50 per share.
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