CBA warns of loan losses
The Commonwealth Bank warned investors at its annual general meeting yesterday that the bank’s loan losses will increase over the next eight months. The Commonwealth Bank’s chief executive, Ralph Norris, told the meeting that the failures of investment bank Lehman Brothers, Allco Finance Group and ABC Learning Centres will result in “significantly higher first half provisions” for the bank.
Results for the group’s wealth management business had shown it too was not immune from the deterioration of global investment markets, with funds under management for the September quarter at $178 billion, down 3.8 per cent. Retail net flows were also down $266 million.
The situation for the group’s wealth management business didn’t improve in October, with funds under advice (FUA) falling a further 7.7 per cent to $164 billion.
For the four months to October 31, the group’s average FUA declined 8 per cent compared to the previous half, resulting in lower fee revenue and first-half profits for Colonial First State and Colonial First State Global Asset Management.
However, the risk side of the group’s business performed better, with new retail and wholesale business accounting for a 5.2 per cent growth in in-force premiums for the September quarter.
Commonwealth Bank chairman John Schubert said the bank remained “cautious” about the general outlook for the economy for at least the next 18 months.
Recommended for you
In this episode of Relative Return Unplugged, hosts Maja Garaca Djurdjevic and Keith Ford discuss the corporate regulator’s recent discussion paper looking into the rapid growth of private markets and the role of superannuation funds in this “opaque” sector.
On this episode of Relative Return Unplugged, host Maja Garaca Djurdjevic is joined by AMP’s chief economist Shane Oliver to break down the Reserve Bank of Australia’s long anticipated rate cut to 4.1 per cent.
In this episode of Relative Return Unplugged, hosts Maja Garaca Djurdjevic and Keith Ford, along with special guest Liam Garman, break down the economic landscape ahead of the Reserve Bank’s highly anticipated first rate call of 2025.
In this episode of Relative Return, host Laura Dew chats with David Russell, chair of the Transition Pathway Initiative, and Tony Campos, head of sustainable investment at FTSE Russell, about the intricacies of climate investment.
