CBA Shares Surge as $5.4 Billion Profit Smashes Expectations
Synopsis
Commonwealth Bank has shocked the market with a half-year profit of $5.4 billion, which has sent its shares up almost 8 per cent. Although interest rates are moving higher, the banking giant said that most of its customers continued to be ahead on mortgage repayments. Regarding outlook, Comyn said if there is one more rate hike to come, the “rate hiking cycle” is at or near its height. Lower-than-expected bad debts and a dividend boost are combining to make Commonwealth Bank look like a powerhouse in a weak economy.
SYDNEY — The CBA profit shares hit a record high on Wednesday, February 11, 2026, after the bank reported half-year profit that comfortably beat what analysts had expected. CBA cash net profit rose 5% to $5.4 billion, which was enough to send the bank’s shares increasing as much as 7.8% in early afternoon trade.
The result will be a relief to the wider Australian stock market and suggests that the country’s biggest bank is sailing surprisingly smoothly through an era of high interest rates. Despite widespread concern that higher interest rates would result in an avalanche of “bad debts”, CBA announced that its clients are already showing themselves to be surprisingly strong, with 87% of home owners actually ahead on their mortgage repayments. Does the “Big Bank” rally signal that the Australian economy is actually stronger than we think it is?
Comyn Predicts “One More Hike”
CBA CEO Matt Comyn offered optimism to millions of Australians feeling the strain of cost-of-living pressures. Comyn said post-results that he expected the period of rising interest rates to be “relatively short-lived”. He forecasts only one more increase before the Reserve Bank of Australia (RBA) ends its tightening and consideration again turns to easing.
We’ve seen one increase in rates, and we expect there’ll be maybe another one, but we don’t think much more than that,” Comyn said. Although any increase is unwanted for stretched family budgets, the bank expects house prices to continue growing at a rate of about 5% this year, indicating that whatever extra pressure the property market is under it is holding its value.
Dividends and “Bad Debt” Surprise
And one of the biggest shocks for investors was that CBA had not set aside as much money as expected for “bad debts”, which are what people don’t pay back. The bank booked just $319 million in bad debt charges, a fraction of the “gloom and doom” estimates some analysts had been predicting.
That confidence meant the bank was able to reward its shareholders with a 4% increase in its interim dividend, taking it up to $2.35 per share. This is a big win for Australians, CBA is one of the most held stocks in Australia, so presumably, you also hold them in your super without even knowing it.
The War for Mortgages and Tech
Although the profit overall was strong, the bank is facing stiff competition. CBA’s “net interest margin”, the difference between what it pays for deposits and charges for loans, slipped slightly to 2.04 per cent. That’s largely because of “mortgage wars” as banks such as Macquarie chase customers with lower and lower rates.
To stay ahead, CBA is doubling down on its status as a tech leader:
• AI Investment: The bank invested $1.2 billion in technology over six months, and a big bet was on expanding artificial intelligence to scale its services.
• Business Expansion: CBA is cannibalising its home loan market share effectively, and its business banking segment is growing faster than average in the industry.
• Staffing: Unlike some tech companies that are cutting jobs, CBA is in fact adding workers, with more than 51,600 people now on the payroll to help manage its expanding loan book.
Comyn also indicated the bank was open to a conversation about reforming capital gains tax to make housing more affordable, as long as it’s one part of a broader strategy. And as the bank heads into the second half of the year, it continues to be the “anchor” of the Australian financial system, with its $5.4 billion cash result setting a high bar for rivals.
Key Highlights
- CBA’s cash profit totalled $5.4 billion, outstripping the $5.2 billion expected by analysts.
- Its shares surged 7.8 per cent, one of the bank’s best single-day gains in years.
- C.E.O. Matt Comyn anticipates just one more interest rate rise in 2026.
- 87% of CBA’s home loan customers are now ahead on their repayments.
- The bank will pay investors a higher dividend of $2.35 per share.
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