Commonwealth Bank shares have fallen to their lowest level in more than three months after it posted a flat $2.2 billion quarterly cash profit.
The bank attributed the flat March quarter result to an increase in costs and strong competition for loans.
Net profit, which includes one off-items, fell to $2.2 billion in the three months to March 31, from $2.3 billion for the same period a year ago.
Investors punished the company for the result, sending its shares down $3.29, or 3.73 per cent, to $84.85 as of 1025 AEST, their lowest level since late January.
CBA said competition among lenders had weighed on its group net interest margin, the profit it makes on loans, during the quarter.
Meanwhile, expenses rose faster than in previous quarters due to higher regulatory costs and provisions linked to its advice review program.
Growth in the bank’s home loans division was also not as strong as its peers, with the Commonwealth saying it had less of a focus on the fast-growing property investor market.
However household deposits rose by more than 10 per cent during the quarter, while CBA’s wealth management business increased its funds under administration by seven per cent.
The bank said its credit quality remained sound, with arrears in its retail, home loan and credit card portfolio flat compared to a year ago, though personal loan arrears had increased.
