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CBA's First-Quarter Profit Edges Up Amidst Mortgage Expansion
Home Loan and Deposit Growth Offset Margin Squeeze in Competitive Market
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Commonwealth Bank of Australia (CBA), the nation's largest bank by market value, reported a slight increase in first-quarter cash profit, driven by strong growth in home loans and household deposits.
The bank achieved an unaudited cash profit of approximately A$2.6 billion, a 1% rise from the previous two-quarter average and 2% higher than the same period last year.
Despite three rate cuts by the Reserve Bank of Australia stimulating loan volume, CBA’s net interest margin declined due to lower mortgage rates and intensified competition. Net interest income grew by 3%, aided by trading day gains and higher loan volumes, but profitability was impacted by a shift toward lower-yielding liquid assets and deposit switching.
Home lending grew by A$9.3 billion and deposits rose A$17.8 billion in the quarter. Credit quality remained robust with only A$220 million provisioned for loan losses, and improvements were noted in overdue home loans and distressed business loans. Operating expenses increased 4% due to higher wages and tech investments. CEO Matt Comyn emphasized vigilance against competitive pressures and the bank's willingness to adapt accordingly.
For consumers, CBA's performance indicates a stable banking environment with continued access to home loan products. However, the competitive landscape suggests that borrowers should remain proactive in seeking the most favorable loan terms and conditions.
Published:Sunday, 16th Nov 2025 Source: Paige Estritori
Please Note: If this information affects you, seek advice from a licensed professional.
Australia's leading banks-Commonwealth Bank of Australia (CBA), Westpac, National Australia Bank (NAB), and ANZ-are adjusting their mortgage strategies to reduce dependence on mortgage brokers. This move comes as profit margins are squeezed by lower interest rates, rising operational costs, and intensified market competition. - read more
On November 3, 2025, Westpac Banking Corporation announced an agreement to sell its RAMS mortgage portfolio, valued at A$21.4 billion, to a consortium comprising Pepper Money, investment firm KKR, and asset manager PIMCO. The sale is at a slight premium to the gross loan value of the portfolio to be transferred at completion. However, Westpac anticipates incurring a loss on the sale after accounting for transaction costs and other financial adjustments. - read more
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