Commonwealth Bank of Australia (ASX:CBA) has reported a full-year cash profit of $10.25bn, up 4% and in line with market expectations, supported by lending growth, a stable net interest margin and lower loan impairment expenses. Statutory net profit after tax rose 7% to $10.13bn. The underlying net interest margin was steady at 2.08% for the half, 9 basis points higher than FY24, with gains from higher earnings on capital partly offset by competitive deposit pricing.
The bank said many households have enjoyed higher disposable incomes following three Reserve Bank interest rate cuts this year, lower inflation and tax relief. Home loan arrears stabilised in the June quarter, with 85% of customers ahead on repayments. Loan impairment expenses fell 9% to $726m, reflecting improved economic conditions, though global trade and geopolitical tensions remain a risk.
CBA will pay a fully franked final dividend of $2.60 a share, bringing the FY25 total to $4.85, up 4% on last year and representing a 79% payout ratio. The bank’s Common Equity Tier 1 capital ratio remained strong at 12.3%, above regulatory requirements, with $300m of a planned $1bn share buy-back completed. Return on equity was steady at 13.5%.
Operating expenses rose 6% to $12.99bn due to inflation, technology investment and additional frontline staff, partly offset by productivity gains. The bank highlighted $900m invested in fraud and cyber security measures, a 76% reduction in customer scam losses since peak, and ongoing commitments to regional branches through mid-2027.
