CBA wealth reports increase
The Commonwealth Bank (CBA) has reported an increase in its wealth management average assets under management (AUM) and funds under administration (FUA) even as wealth divisions had not met expectations for its counterparts.
In its September Quarter Trading Update, the CBA reported AUM in wealth management had increased by three per cent, while FUA had increased by two per cent, which it said was driven by strong investment markets and positive net flows.
CBA also reported that operating income growth was slightly below that of financial year 2016 due to low interest rates, stronger Australian dollar, and higher insurance claims.
The group's unaudited cash earnings for the three months ended 30 September were around $2.4 billion. Statutory net profit on an unaudited basis for the same period was also around $2.4 billion.
"Expenses were well managed in a lower growth environment, resulting in positive ‘jaws' in the quarter, notwithstanding ongoing investment in the businesses," the update said.
The group's lending portfolio credit quality remained firm, with consumer arrears declining in line with seasonal expectations. Loan impairment expense (LIE) was $322 million in the quarter, while consumer LIE was higher in the quarter as it was affected by the mining downturn in Western Australia and Queensland.
Group troublesome and impaired assets rose slightly to $6.8 billion, due to continued stress in the New Zealand dairy sector.
AUTHOR
Malavika Santhebennur
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