CBA | VALUATION

This is likely above my pay grade, however it was interesting to hear Todd Barlow, the Soul Patts CEO mention the CBA performance, and broadly valuation, in his Q&A yesterday.

I suspect they are a pretty sizeable holder, especially care of the Milton merger, however he opined along the lines of:

"CBA is up 60% this year - for no apparent reason, it just doesn't make much sense"

I had to check this, but if you include dividends it's up every bit of 60% on the year.

They seem pretty cautious operators, so he was circumspect about listed market valuations across the board at the moment.

When trying to appraise the uptick in valuation, I wonder where or how it goes from here.

Broadly speaking, banks (esp the govt-backed variety with healthy sources of lazy deposits) are good businesses, they take a deposit, lend it out 8x and trouser the spread. This one also makes a few bob off half the population in the country at every turn.
Then they also have this high immigration ponzi scheme helping to underwrite demand.

but then again, they are up against:

Plenty of competition from the private credit fleabag arena.

High interest rates and even higher asset values against which they have to lend.

Low unemployment and super low credit provisions.

Is it a case of the quant funds lapping up their short-term momentum formulas? or superfunds having nowhere else to go? or index funds just blindly pumping in dosh?

or are the good times going to get even better for the banks?