Commonwealth Bank Raises Half-Year Earnings Forecast

Vanessa Doctor

19 January 2010

The Commonwealth Bank of Australia has said it expects a 44 per cent rise in cash earnings for the six months to 31 December.

The bank gave a surprise announcement before markets closed last week with an upgraded profit forecast of A$2.9 billion ($2.67 billion) -- a result significantly above its prior and analysts' expectations of A$2.7 billion.

CBA said that solid income growth across its banking business was the key driver of the increase, including efficient cost management, good volume growth, a drop in impairment expenses, and improving equity markets.

"The result reflects a continuation of the momentum reported on 9 November 2009 in the group's September quarter trading update," the statement said.

The stock went up three per cent to $58.10 just before Friday's close. The sharemarket had been in the red throughout the session but CBA's announcement managed to boost the S&P/ASX 200 benchmark by 1.6 points to 4899.6.

Full results for the said period will be announced on 10 February, after all accounts have been audited and reviewed.