CBA earnings up 1% YoY to A$718m in H1 as deposit margins fall

Customer margins remained flat during the period.

Commonwealth Bank of Australia’s (CBA) net profit after tax rose 1% year-on-year (YoY) to $511.11m (A$718m) for the six-month period ending 31 December 2025, according to a bourse filing.

Home lending grew 8% during the period, whilst deposits rose by 5%. However, customer margins remained flat on higher home lending margins and lower deposit margins, the Australian bank said in a filing posted on the ASX on 11 February 2026.

Pre-provision profit rose 5% YoY to $5.79b (A$8.13b), which CBA said reflected solid operational performance across its core businesses.

Interim dividend was A$2.35 per share. Dividend payout ratio is ~74% of cash NPAT on a normalised basis.

Net interest margin fell 4 basis points (bps) to 2.04%, which CBA blamed on competition in the home lending market and lower treasury and market income.

Operating expenses rose 5% YoY on the back of inflation, increased investment in technology, and additional lenders and operations resources. This was partly offset by benefits from productivity initiatives, it said.

Investment spending rose 10% YoY to almost $861.34m ($1.21b), reflecting ongoing modernisation of CBA’s technology infrastructure.

Common equity tier 1 (CET1) ratio is 12.3%, above APRA’s minimal regulator requirement of 10.25%. CBA’s CET1 ratio is flat compared to June 2025 and 10 bps higher than in December 2024.

Looking ahead, CEO Matt Comyn expressed optimism for the prospects of the Australian economy.

Comyn expects upward pressure on interest rates.

“Economic growth strengthened during the half, driven by increases in consumer demand and rising investment in AI and energy infrastructure. Supply side constraints mean that the economy is struggling to meet this increased demand,” Comyn said.

(US$1 = A$1.4 ; Morningstar via Google)