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General Information

Commonwealth Bank of Australia
CBA
http://www.commbank.com.au
Diversified Banks
150,910
1,628

Current Price Data+

Current Price Open High Low Last Close Volume Price Movement
$92.72 $92.53 $92.74 $91.92 $92.10 1857016 $0.62 ( 0.67% )
  • +Security prices are delayed by least 20 minutes and are indicative only.

Current Broker Consensus Recommendation

Hold
24/04/2015
3

Company Overview

Business Description
Commonwealth Bank of Australia (CBA) is an Australian retail bank. Its core business is the provision of a broad range of banking and financial products and services to retail, small business, corporate and institutional clients. CBA conducts its operations primarily in Australia, New Zealand and Asia Pacific region. It also operates in several countries including United Kingdom and USA.
Strategy Analysis
CBA generates superior shareholder returns by optimising revenue growth, productivity, capital efficiency and staff culture. The strategy is to invest in the competitive advantages that are difficult to replicate. The bank specifies its three primary sources of advantage as industry-leading application of technology to financial services, a customer-focused staff culture and a strong balance sheet. Each of these respectively supports returns on equity by making CBA more attractive to customers in a multi-channel banking world (an intangible asset), enhancing customer loyalty and satisfaction (another intangible asset), and reducing bad debts expense below peers´ (a cost advantage). Lower losses on bad debts give CBA more room to price keenly to win and retain business while remaining sufficiently profitable. The group will continue to invest in all three sources of advantage. CBA´s industry-leading technology initiative is the $1.1bn Core Banking Modernisation project, which rolled out real-time banking and same-day settlement across the depositor and borrower customer base. The project is effectively complete and CBA will be the only major bank offering these features across its customer base, an advantage which will take competitors years to replicate given the project was launched in 2008. CBA´s policy on acquisitions is to acquire only when it can create more value for shareholders than they can create for themselves. Commonwealth Bank of Australia reported NPAT up 1% to $3.66bn for the half-year ended 31 December 2012. Cash NPAT for the current half was $3.78bn, an increase of 6%. Revenues from ordinary activities were $22.92bn, down 4% from the same period last year. Diluted EPS was 221.7 cents compared to 222.1 cents last year. Net operating cash flow was $3.62bn compared to $8.34bn last year. The interim dividend declared was 164.0 cents compared with 137.0 cents last year. While many of the group's customers are facing challenges, this is not translating into a deterioration of credit quality. However, given the uncertain outlook for both the global and domestic economies, the group remains cautious maintaining a strong balance sheet with high levels of capital, provisioning and liquidity - $128.0bn as at 31 December 2012.

Financial Summary

Year to Jun NPAT EPS EPS chg (%) PER DPS Yield (%) Franking (%)
2016 F 10,052.7 609.5 6.0% 15.1 457.0 5.0% 100.0%
2015 F 9,369.7 575.2 7.3% 16.0 431.0 4.7% 100.0%
2014 A 8,635.0 536.0 10.3% 14.1 401.0 5.3% 100.0%

Peer Comparison

Company Mkt Cap EPS Growth (%) P/E (%) Dividend Yield (%)
2014 A 2015 F 2016 F 2014 A 2015 F 2016 F 2014 A 2015 F 2016 F
ANZ Bank (ANZ) $98,801M 0.2133 0.0336 0.0278 13.6102 13.1682 12.8116 4.98% 5.23% 5.49%
Bendigo Adelaide Bnk (BEN) $5,481M 0.1222 0.1288 0.0362 14.4547 12.8056 12.3583 5.29% 5.62% 5.87%
Commonwealth Bank (CBA) $149,901M 0.1201 0.0839 0.0549 17.3793 16.0341 15.1990 4.35% 4.67% 4.93%
National Aust. Bank (NAB) $92,172M -0.1382 0.2635 0.0838 17.8272 14.1099 13.0185 5.20% 5.47% 5.80%
Westpac (WBC) $119,877M 0.0976 0.0301 0.0520 15.5995 15.1439 14.3949 4.74% 4.96% 5.17%

Financial Summary

Earnings P/E Ratio P/B Ratio P/E Growth
Company 0.87 16.40 3.07 2.36
Market 0.91 16.70 1.31 2.21
Sector 0.85 15.50 1.53 1.61

Directors

Name Position Start Date
Mr Ian Mark Narev Chief Executive Officer, Managing Director 01/12/2011
Mr Brian James Long Director 01/09/2010
Mr David John Turner Non-Executive Chairman 01/08/2006
Mr Andrew Max Mohl Non-Executive Director 01/07/2008
Sir David H Higgins Non-Executive Director 01/09/2014
Ms Jane Sharman Hemstritch Non-Executive Director 09/10/2006
Mr Harrison Hurst Young Non-Executive Director 13/02/2007
Sir John Anthony Anderson Non-Executive Director 12/03/2007
Ms Launa Karen Inman Non-Executive Director 16/03/2011
Mr Shirish Apte Non-Executive Director 10/06/2014
Ms Wendy Stops Non-Executive Director 09/03/2015

Management

Name Position
Carla Felicita Collingwood Company Secretary
Alden Toevs Group Chief Risk Officer
David Cohen Group Executive Group Corporate Affairs,Company Secretary
Grahame Petersen Group Executive, Business and Private Banking
Michael Harte Group Executive, Enterprise Services and Chief Information Officer
David Craig Group Executive, Financial Services and Chief Financial Officer
Robert Jesudason Group Executive, Group Strategic Development
Melanie Laing Group Executive, Human Resources
Kelly Bayer Rosmarin Group Executive, Institutional Banking and Markets
Simon Blair Group Executive, International Financial Services
Matthew Comyn Group Executive, Retail Banking Services
Annabel Spring Group Executive, Wealth Management
David Cohen Group General Counsel and Group Executive, Group Corporate Affairs

Calendar of Events

Date Event
10 February 2016 Report (Interim)
01 October 2015 Report (Annual)
17 August 2015 Report (Annual)
12 August 2015 Report (Prelim)
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