Commonwealth Bank (CBA) profit rose 11% to $9.6 billion

Commonwealth Bank, which posted a profit of $9.6 billion, plans to raise its dividend after the banking giant’s earnings benefit from solid loan growth and a reduction in bad debt.

When the CBA released its full-year results on Wednesday, Chief Executive Matt Comin said households were in a strong position but expected consumer spending to soften amid rising costs of living.

“Despite many measures, Australian households and businesses are in a strong position given low unemployment, low underemployment and strong non-mining investment. It’s going up and it’s hurting consumer confidence,” Komin said.

Cash earnings increased 11% to $9.6 billion, the bank said, contributing to higher volumes in its core business and loan impairment benefits of $355 million. CBA will pay him a final dividend of $2.10 per share.

The consensus forecast among analysts was a cash gain of $9.24 billion and a final dividend of $2.09, according to Citi analysts.

The CBA results highlight how banks are being affected by rising interest rates that have sparked investor fears of bad debt and a slowdown in the real estate market that will have a material impact on bank loan growth. because there is

At the same time, investors hope that higher interest rates will ultimately boost banks’ profit margins.

In the CBA’s last trading update in May, the CBA reported that margins were being squeezed by fierce competition in mortgage lending, in addition to slowing growth in the mortgage market.