The Commonwealth Bank has announced a cash profit of $5billion after closing down 354 branches and removing 2,297 ATMs in just five years.
The half-year result for ‘s biggest home lender disappointed market expectations, with CBA warning higher interest rates were likely to see more borrowers struggle to pay their mortgage in 2024.
The cash profit of $5.019billion, covering July to December 2023, was three per cent weaker compared with the same period in 2022, and included the Reserve Bank in November raising interest rates for the 13th time in 18 months.
The market had expected CBA to post a cash net profit of $5.1billion, even though interest rates are now at a 12-year high of 4.35 per cent.
Chief executive Matt Comyn said cost-of-living pressures continued to make n consumers cut back on their spending during the first six months of the 2023-24 financial year.
‘Twenty twenty-three was increasingly challenging for many of our customers who are finding it harder to absorb the cost of living pressures,’ he said.
Mr Comyn said the Commonwealth Bank was expecting more borrowers to fall behind on their mortgage repayments.
‘As cash rate increases have a lagged impact on households and business customers, we expect financial strain to continue in 2024, with an uptick in our arrears and impairments,’ he said.
Shareholders continued to benefit, however, receiving a dividend of $2.15 per share which was two per cent higher than the corresponding period in 2022.
The bank’s net profit margin the difference between its funding costs and what it charges for loans – fell 6 points from the prior financial half to 1.99 per cent.
The bank blamed the fall on increased competition, higher funding costs and customer behaviour.
The Commonwealth Bank has announced a cash profit of $5 billion, which was short of market expectations and comes after the bank closed 354 branches and removed 2,297 ATMS in the past five years
Earlier this month Daily Mail revealed CBA had closed 354 branches during the past five years and has plans to close down more three branches next month in populated areas of three major cities.
Despite making a record profit, ‘s biggest home lender has shut down a third of its branches since June 2018 when 1,082 were still operating.
A steep decline in the use of cash has also seen CBA remove 2,297 ATMs during that time, marking a 54 per cent plunge or a halving in the number of banknote dispensing machines.
The bank is now planning to close down its Rundle Mall branch in central Adelaide, along with outlets at Coolangatta on the Gold Coast and Coogee in Sydney on March 1.
‘After a recent review, we made the difficult decision to permanently close our Rundle Mall Adelaide, Coolangatta and Coogee branches,’ a spokesman told Daily Mail .