Commonwealth Bank First-Quarter Profit Rises as Bad Debts FallBy
Commonwealth Bank of Australia first-quarter earnings rose as bad debt charges declined.
Unaudited cash profit, which excludes one-time items, increased to A$2.65 billion ($2 billion) in the three months ended Sept. 30 from A$2.4 billion a year earlier, the bank said in a statement on Wednesday.
The bank’s bad debt expense was A$198 million in the quarter, equal to 11 basis points of gross loans, down from 15 basis points last fiscal year.
CBA’s quarterly results round-off a subdued earnings seasons for Australia’s big four banks. The lender has a June financial year, compared to the September year-end for its three biggest competitors.
National Australia Bank Ltd. joined the ranks of other global lenders in shedding jobs in the face of advancing technology, announcing plans to eliminate 12 percent of its workforce. Westpac Banking Corp. undershot estimates as revenue growth slowed and lending profitability declined. Australia & New Zealand Banking Group Ltd. also warned of a tougher outlook.
Australia’s big four banks are focusing on reducing costs, simplifying their businesses and selling non-core assets as the prospects for growth get tougher. The industry is facing headwinds from a subdued economic environment, the slowing housing market and increased regulatory and political pressure.