Profit slide caps turbulent year for Commonwealth Bank

SYDNEY: Australia’s biggest bank, the Commonwealth, posted a slide in annual profits yesterday, capping a tumultuous year for a troubled lender which has been rocked by scandals and board upheaval. The country’s largest firm by market capitalization reported Aus$9.37 billion (US$6.95 billion) in statutory net profit from continuing operations for the year to June 30, a four percent drop and its first annual fall since 2009.

Cash profits, its preferred earnings measure, also fell, down 4.8 percent to Aus$9.23 billion from the previous year and slightly below market expectations. The decline was mostly driven by a Aus$700 million penalty paid to financial intelligence agency AUSTRAC after it breached anti-money laundering laws, along with compliance and regulatory costs. Chief executive Matt Comyn, handing down his first annual results, admitted it had been a “difficult” 12 months.

“We got some things wrong. We have made mistakes. We absolutely need to make sure we do not make them again,” he said, while insisting the bank remained in good shape.

“Despite the challenges we have faced this year, the fundamentals of our business remained strong,” he said. “We also continued to strengthen our balance sheet. This performance has supported a higher dividend for shareholders.” The bank, viewed as a bellwether for the industry due to its size, announced a final dividend of Aus$2.31, pushing its full-year shareholder payout to Aus$4.31 per share, up two cents on the previous year. — AFP