Unlike the other banks CBA had plenty of franking credits to lean on so was under pressure to do a buy back of this style. But quite literally after some of the banks sold shares on the lows not 18 months ago, they are buying them back on the highs. Investors could do a lot worse than trade against the big fours' fiduciary management long-term - banks selling their shares on the low and buying them on the high.
133 basis points from its tier 1 capital is not insignficant and whilst CBA still has a decent buffer to APRA requirements, given over 20% of recent banks loans had a debt-to-income of ratio of six or more, which is considered risky by APRA, we can expect some changes from APRA soon.
Perhaps not the best timing to be significantly reducing your capita ratios.
CBA Price at posting:
$105.45 Sentiment: Sell Disclosure: Not Held
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