CommBank reports better quarter for wealth management
The Commonwealth Bank has confirmed a 25 per cent decline in its dividend for the current financial year at the same time as pointing to some improvement in the performance of its wealth management and insurance divisions.
In a March quarter trading update issued on the Australian Securities Exchange (ASX), the big banking group said the final dividend for the current financial year would be $1.15, which represented a 25 per cent decline on last year’s final dividend and a 14 per cent decline on the prior full-year.
However, drilling down into its division performances, the banking group pointed to the fact that funds under management (FUM) within its wealth management and insurance division had declined by just 0.1 per cent during the quarter to $158 billion and that net flows had been positive at $1.2 billion.
It said that while relative performance had been good, average FUA was declining, which would lead to lower second-half revenue.
It said CommInsure had grown in-force premiums and market share but that adverse events in the second half, such as the Victorian bushfires and Queensland storms, had led to higher general insurance claims.
Commenting on the quarter, Commonwealth chief executive Ralph Norris said that while there would be bumps in the road, the group felt that global financial markets were no longer in freefall and that some of the measures taken internationally and domestically had been effective in mitigating an otherwise more ominous set of scenarios.
AUTHOR
Mike Taylor
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