Commonwealth Bank of Australia’s profit climbed as higher interest rates and a buoyant housing market supported results at the nation’s largest lender.
Cash profit rose to A$10.2 billion ($6.7 billion) for the year to June 30, according to a statement Wednesday. That compared with the A$10.1 billion average estimate of eight analysts surveyed by Bloomberg.
Lenders in the country were buoyed by higher borrowing costs over the past year that so far have been accompanied by few economic shocks and an ultra-low unemployment rate. Still, it’s been a period of intense competition for home loans and investors are weighing whether the good times will give way to further margin pressure and more signs of stress on families and businesses.
“The Australian economy has been resilient with the tailwinds of a recovery in population growth, relatively high commodity prices and low unemployment,” Chief Executive Officer Matt Comyn said in the statement. “However there are signs of downside risks building as rising interest rates have a lagged impact on mortgage customers and other cost of living pressures become a financial strain for more Australians.”
