CommBank solidly in black, but CFS struggles
The Commonwealth Bank has defied the generally choppy market conditions to report an 11 per cent increase in statutory net profit after tax to $7,090 million.
The result will see shareholders rewarded with a 5 per cent increase in the final dividend to $1.97 per share.
However, the bank's Wealth Management division was one of the few areas to take a hit, recording an 11 per cent decline in net profit to $569 million, despite a stronger second half.
As well, the big banking group reported a 25 per cent decline in underlying profit after tax for Colonial First State (CFS), which it said was attributable to weakness in market conditions, increased compliance related costs and remediation expenses.
However, it said its FirstChoice and FirstWrap platforms were continuing to grow market share - albeit, equity market weakness had contributed to strong investment flows into cash, fixed interest and deposit products.
The banking group said the acquisition and integration of Count Financial had seen CFS expand its distribution footprint to become the second largest adviser network in the market.
CommInsure recorded a 3 per cent decline in underlying profit after tax, despite lifting insurance income growth by 11 per cent.
Commenting on the overall banking group result, CBA chief executive Ian Narev described it as good, given the uncertain operating environment.
He said the group remained positive about the medium to long-term outlook for Australia, but the global economy remained uncertain.
"It is difficult to see the catalyst for alleviating the uncertainty which will continue to affect consumer and corporate confidence," Narev said. "So, in the near term, we expect current revenue trends to continue, and we will retain conservative business settings."
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