Commonwealth Bank of Australia posted a one per cent decline in annual net profit to A$4.723 billion ($3.89 billion), from A$4.791 billion in the previous year, due to slowing credit growth and rising bad debt.

The figures came with a 61 per cent drop in cash net profit after tax for its wealth management business from the prior year to A$286 million. The result was adversely impacted by significantly lower investment experience returns after tax, mostly due to unrealised mark-to-market losses and the impairment of listed and unlisted investments, the bank said in its full year results statement.

Total operating expenses for the division were also down 4 per cent on the year earlier period to A$1.156 billion. Expense reductions were primarily attributed to cost management initiatives across wealth management units and reduced staff incentives and lower profits.

The bank's cash gains, through which it measures its profitability, dwindled 7 per cent to A$4.415 billion on the previous year, on the back of an almost tripling of bad debt numbers.

Chief executive Ralph Norris said that despite the global crisis the bank had performed well. However, he warned that growth is expected to slow and the economic situation will likely remain challenging.