Wealth management boosts CBA resultFeb 09 09:57AFR The nation's...

Wealth management boosts CBA result
Feb 09 09:57
AFR

The nation's largest retail bank, Commonwealth Bank, on Wednesday unveiled a 42 per cent improvement in half-year net profit, boosted by wealth management earnings, but warned of a continuing squeeze from a competitive market.

CBA said its cash net profit totaled $1.756 billion for the six months to December. On an underlying basis, which excludes the roll off of charges from its 'Which New Bank' restructuring program,, profit rose 12 per cent to $1.664 billion.

The bank said it expected cash earnings per share to grow by 25-30 per cent in the full financial year as the Australian economy remains strong.

"This partly reflects the impact of expenses related to Which New Bank being substantially lower in 2005 than in 2004 and the realisation of benefits which are continuing to increase," the bank said.

CBA also said it saw no change in the highly competitive environment for financial services. This was reflected in a further 2 basis point decline in its next interest margin to 2.44 per cent, bringing the full-year decline to 16 basis point.

On an operational basis, the star performer was funds management, where underlying net profit grew by 35 per cent from the previous corresponding period to $170 million. Funds under administration rose 7 per cent to $117.4 billion.