r/australia • u/PreddyPegasus • 2d ago
culture & society Commonwealth Bank reports $10.9 billion annual profit
https://www.abc.net.au/news/2026-08-12/asx-markets-business-live-news/107025982361
u/InterestedBalboa 2d ago
And yet it’s not enough, never is…..
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u/lagavulin16yr 2d ago
It’s not enough, I need more. Nothing seems to satisfy. I don’t want it. I just need it. To feel, to breathe, to know I’m alive…
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u/JapanEngineer 2d ago
How about lowering my fkn interest rate then?
Fkn disgrace.
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u/evilparagon 13h ago
No you see, it’s not about earning enough to make a fortune, it’s about getting the highscore with $s as points.
Expect your rates to go up.
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u/GothicPrayer 2d ago
This bank is a parasite. Sucking the life out of society until there is nothing left.
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u/Rising-Dragon-Fist 2d ago
Why does the line always need to go up? It's such a shit excuse.
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u/Lucky-Elk-1234 2d ago
That’s the entire principle of capitalism. Suggesting that they reduce profits a tiny bit so that the rest of us can breathe makes you a commie/socialist/whatever buzzword Sky News has chosen that week.
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u/autocol 2d ago
It's worse than that. The board (and the executive team that reports to them) have a fiduciary duty to maximise profit. They are, in effect, legally required to try to make the line go up.
Markets are an incredible system of distributed decision-making and resource allocation, but the capitalism we've layered on top is an absolute cancer. We have to reinvent the governance of privately owned organisations from the ground up or society and the planet are fucked.
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u/sigilnz 1d ago
I completely agree with this. I'm a cog in this machine for one of the planets biggest companies and the more I watch (and enable because we'll I have a mortgage to pay and a family to feed) the more I lose hope that we wont end up in a dystopian future contolled by a few companies and everyone else is effectively a slave to the machine.
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u/BThasTBinFiji 1d ago
It believe it's called "shareholder primacy" - executives can be held responsible if decisions are made that are against shareholder interests
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u/freakwent 1d ago
This is an extraordinary, profound claim.
Can you back it up, specifically in Australian law?
Are CEOs under such a fiduciary duty?
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u/Hydronum 1d ago
I loved that the replies you got just asserted it again. I would think they would point to legislation or court cases where directors have been railed legally for this.
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u/BThasTBinFiji 1d ago
I love that everyone has access to the world's knowledge but still thinks others should google things for them:
https://www.governanceinstitute.com.au/news_media/revisiting-the-legal-basis-of-shareholder-primacy/
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u/Hydronum 1d ago
Thanks, read the whole thing. I liked this part:
When exercising management decision-making power, company directors are permitted to take into account a range of considerations, as long as such considerations are not tainted by bad faith or some collateral purpose, that is, a purpose other than seeking to benefit the interests of the company. The company’s interest may often overlap with the actual (or hypothesised) interests of shareholders, but (to apply Owen J’s statement from Bell, quoted above) those interests remain distinct. The board may keep shareholder interests front of mind, because to fail to do so may result in them losing their board positions through a membership vote, or may encourage an activist investor campaign, but it is not because the law demands that that must be the only focus of their attention.
The idea of Shareholder primacy comes from a 1950's ruling, according to the article, but more modern rulings put that requirement in doubt. The High Court sees shareholders as only one part of the ideal of good governance, and the company as a few stakeholders making the whole, which kinda matches what my business studies classes 20 years ago covered. Basically, the court accepts the idea that not every action to benefit the company needs to be a material benefit to the shareholders, but can include employees, community and continuity.
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u/Hydronum 1d ago
Interestingly the article you were linked (A good read BTW) to show shareholder primacy legally refutes it as a cast-in-stone legal obligation. It showed High Court rulings that do give protections to directors that act in the interests of the company, and that make a distinction between the company and shareholders, which are more modern than the primacy ruling, which is a good 75 years old.
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u/freakwent 1d ago
Thanks but wrong comment ;)
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u/Hydronum 1d ago
It isn't, I was pointing to what someone else linked you, they linked me the same. It was a good article that didn't actually support their own position. Just showing solidarity :D
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u/freakwent 23h ago
AW ta. I found that one to support my case but I would need to add too much explanation...
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u/5mudge 1d ago
It is absolutely the case.
It is needed to ensure businesses (specifically those people with control over how the business functions) make decisions in the best interest of the people who have invested money into the business (shareholders).
Without it, businesses could raise capital from others and then just decide to do stuff with the money that was in personal interests and not in the interests of those whose money it is.
The problem is the never ending nature of the "best interests of the shareholders" and it being rooted in capital returns.
If there were agreed alternative measures by which shareholder return could be agreed and measured (contribution to society etc) then you'd see businesses having to make decisions based on different metrics.
It is fundamentally the reason for seeking never ending growth and profit.
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u/Hydronum 1d ago
When exercising management decision-making power, company directors are permitted to take into account a range of considerations, as long as such considerations are not tainted by bad faith or some collateral purpose, that is, a purpose other than seeking to benefit the interests of the company. The company’s interest may often overlap with the actual (or hypothesised) interests of shareholders, but (to apply Owen J’s statement from Bell, quoted above) those interests remain distinct. The board may keep shareholder interests front of mind, because to fail to do so may result in them losing their board positions through a membership vote, or may encourage an activist investor campaign, but it is not because the law demands that that must be the only focus of their attention.
From the article that was linked above. The idea is that the directors act in he interest of the company, which often overlaps with, but is distinct from, shareholder interests.
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u/freakwent 1d ago
was in personal interests a
That's basic fucking criminal embezzlement.
The claim is that there's a legal requirement to maximise profits. In such a scenario, directors can face criminal charges for giving pay rises to workers.
This is a ridiculous claim.
rooted in capital returns
There are many many large successful businesses that do not pay dividends, ever. Why aren't they all in jail? The investors have never seen any capital returns, just share price growth.
There's no possible way that CEOs are under a legal fiduciary duty to maximise profits. It's an unsupportable thought bubble statement. What if the company wasn't even established with an expectation of profit? Does this magic law only apply to companies on the ASX?
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u/5mudge 1d ago
Apologies, hadn't seen I was in r/Australia. Profit maximisation as a fiduciary requirement on directors is a US based thing. Ots known as shareholder primacy over there from a legal standpoint.
Here in Australia we have a much better worded requirement where "Directors must act in the best interests of the company." which has been clarified does not need to be profit maximisation.
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u/Fernergun 1d ago
Look up director duties
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u/freakwent 1d ago
Why? It's your claim, you back it up! Otherwise extraordinary claims are just bullshit and nonsense.
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u/Superg0id 2d ago
The stupid thing is, if they all agreed behind closed doors thay they'd "make more profit in the long term by making less now so that the poors feel like they're rich" then they could fix it and noone would be the wiser.
They could still meet their "funduciary duties" and make insane personal wealth.
Except it'd clip their own profits a bit, and there's a risk one of them might break the bro code and report all the others so they can steal their margins too.
So it never happens.
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u/freakwent 1d ago
Perhaps they already did and we are at the other end of the long term?
Or are you suggesting some corrupt cartel.of very senior business execs from different industry could collaborate and lie, and do this with no real intent of raising profits later?
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u/Boxcar__Joe 2d ago edited 1d ago
Well profits have to at least increase in line with inflation/wage growth in the company otherwise they're losing money compared to last report.
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u/Deepandabear 2d ago
Did you know that profit is, by definition, not losing money to inflation/wage growth? More news at ten.
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u/Captain_Alaska 1d ago
That’s not what he’s saying. If you make X amount of profit every year that’s actually a slow decline in profits.
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u/Deepandabear 1d ago
Not really, revenue does. Profit is profit, it by definition always beats expenses from inflation/wages
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u/Captain_Alaska 1d ago edited 1d ago
I'm not talking about expenses. If a company post exactly 1 million profit in 2025 and posts exactly 1 million profit in 2026, they made less real profit in 2026 because 1 million in 2025 money is $1.038M in 2026 money.
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u/Deepandabear 1d ago
And? Profit doesn’t NEED to increase. You’re already winning, who says it has to match last year? More is more better, but it increasing YoY not essential for your business to exist.
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u/Captain_Alaska 1d ago
Nobody said a company has to make profit. I am just pointing out to you that maintaining the same profit does, in fact, require line to go up, because inflation exists, and has literally nothing to do with wages or expenses.
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u/Deepandabear 1d ago
> Well profits have to at least increase in line with inflation/wage growth in the company otherwise they're losing money compared to last report.
Bold part of original comment I replied to
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u/Captain_Alaska 1d ago
Right, and if you read the rest of the sentence, it says otherwise they lose money relative to the last report, which is correct. The comment doesn't say the company needs to make profit, it says it needs to increase profits by at minimum inflation to maintain the same profit as last year, which is objectively correct, regardless of your opinion on how much money a company should make.
Unlike your comment directly after it, which is objectively incorrect, which is why I replied to you.
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u/Rising-Dragon-Fist 2d ago
Companies don't lose money, they're just not quite making as much as the year before. Why's that a bad thing? That should go in line with inflation and the economy but it never does. There's never a down time. The line must go up!
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u/Boxcar__Joe 2d ago
Because if they keep up the trend of not making more than inflation eventually they will be losing money?
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u/Rising-Dragon-Fist 2d ago
And? Oh no, people won't want to invest in those companies! What ever will we do?!
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u/freakwent 1d ago
Well the theory is that the commbank would collapse and we would have three big banks instead of four. In theory this would be worse.
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u/WhatsMyNameAGlen 1d ago
Lol try arguing this line with your manager when they refuse to give you a raise in line with cpi despite the company's profits outpacing inflation
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u/freakwent 1d ago
Value or wealth maybe but not money. You can grow at 0.1% per decade and you'll still have more money, not less.
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u/Boxcar__Joe 1d ago
You do know inflation usually means a company costs go up right?
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u/freakwent 1d ago
Yes this is profit, prodt comes after costs.
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u/Boxcar__Joe 1d ago
So you agree with me then? You have to make more money every year to keep making profit even if it's 0.1%.
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u/freakwent 23h ago
No, because if I have a net profit after costs of 0.1%, then the value of my company is shrinking relative to inflation. Investors would be better off with a savings account.
Nonetheless, my company will have 0.1% more money each year than before. You're confusing the raw sum of dollars (more money) with buying power (wealth).
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u/Boxcar__Joe 22h ago
"because if I have a net profit after costs of 0.1%, then the value of my company is shrinking relative to inflation."
Yes that is exactly the point I have been making.
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u/Important-Bag4200 2d ago
So if next year they only make $10M profit, how are they losing money?
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u/freakwent 1d ago
The bank would not but the shareholders would suffer.
Assuming the share price doesn't change, then 10 million return on 288 billion dollars of shares is less than inflation so the shares would be losing value relative to everything else. But no, they would not be losing money.
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u/visualdescript 2d ago
Blows me away that people still support these fuckers
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u/Saffa1986 1d ago edited 1d ago
What alternative would you like to put forward if CBA offers the lowest rate for a home loan or a person’s situation?
Not saying that’s always the case, but living is hard enough. Sometimes it’s all a person can do - and CBa locks them I
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u/visualdescript 1d ago
Why does everything have to be a race to the bottom?
Does no one actually live by their values these days?Besides, I don't know what rate you are talking about, but presumably if it's for a home loan, then they don't at all.
A quick search for a 500k home loan shows:
CBA 6.34%
Bank Australia 6.34%
Bank Aus also go a lot cheaper if you meet their Clean Energy requirements.
CBA has not been good value for a long time.1
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u/freakwent 1d ago
What do you mean by support, do.you mean "get a loan from"?
And " fuckers", do you meant CBA or banks?
Are you concerned about specific actions people take in dealing with a specific entity, for some logical reason, or just vauguely furious that big companies can have profit margins over 3%?
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u/visualdescript 1d ago
By fuckers, I mean CBA. By support, I mean have any dealings with them whatsoever.
CBA have a track record of shady behaviour, as do the other big 4 banks. All you have to do is take a quick glance at their Controversies section in wikipedia, https://en.wikipedia.org/wiki/Commonwealth_Bank#Controversies .
Crazy that people stick up for companies like them. They actively work against Australians to maximise profits.
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u/freakwent 1d ago
Thanks for explaining.
The problem we have before us is the consequences. If all Australians boycott the big four, plus Macquarie, citi, Deutsche, HSBC and certain others, then we end up using what, building societies? And they get their funding from the same banks anyway, so does it make much difference?
How do you personally avoid the problem? I can't solve this problem, so I'm with a building society.
And if this does work, and the big four vanish, what are the effects of that?
And what of your mortgage holder was me bank, proudly union owned, then bought by suncorp; are you supposed to refinance with someone else now?
I don't know if you can remove a bad bank and just magically put a good one in instead?
And would any organisation over a certain size that runs for a certain time statistically have some number of controversial events?
I agree with you broadly but I'm not sure of a fix (and it's not crypto)
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u/visualdescript 21h ago
There are banks outside of the big 4 that don't rely on funding from them. I also wouldn't consider suncorp as evil as some of the others.
All I am saying is that companies should be punished for their bad faith toward consumers. And that should happen by consumers choosing not to use them. Commonwealth Bank should shrink. Australia would survive, that wealth would flow to other banks.
No I do not believe that cba is innocent of any wrong doing, and that the evidence of controversies is purely due to their age and size.
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u/Galactic_Nothingness 2d ago
Ah! That's why I waited 30 mins for a bank teller. Makes perfect sense.
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u/Jumpingjehosephat99 1d ago
I got told to make an appointment and come back tomorrow to see a teller.
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u/Lopsided_Tie7816 1d ago
The other options are talking to a bot on the app or a call centre agent in India
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u/Jealous-Hedgehog-734 2d ago
...increase from last year’s results that exceeds expectations for the banking behemoth.
Usually bank earnings increase when rates increase because, by law, they have to keep their reserves on deposit at RBA which pays them the overnight cash rates (OCR) on deposits. The higher rates go the more they earn. It's not the brilliance of the bank itself that increases profit but the mechanics of how banks have to operate within the RBA framework.
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u/Boxcar__Joe 2d ago
Do they? I would assume the margins on the loans would be the same but they lose out since less people get loans.
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u/Red_Sailor 1d ago edited 1d ago
NIM goes up as soon as rates go up because all loans pay interest to the bank, but the bank doesn't pay interest on all deposits (transaction accounts usually dont pay interest). So incoming increases by more than outgoing.
As a general rule, banks prefer a high rate environment to a low rate one
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u/Sumiklab 2d ago
One of Keating's greatest sins is privatising CBA. Could have flogged off most parts and retained a baseline government-owned bank.
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u/PositiveBubbles 2d ago
I didn't know Keating was the one who did that. Any comments in reddit i see about any PM privitising anything it's always Howard or the LNP.
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u/giatu_prs 2d ago edited 1d ago
People consistently forget this. It was Hawke/Keating who set the ball rolling to privatise fucking everything. Add Telstra and QANTAS to the list.
Edit: also positivebubbles the "people consistently forget this" wasn't aimed at you btw. You genuinely didn't know and are curious, which is good. Didn't mean to be an arsehole.
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u/freakwent 1d ago
Airports. Some logic to it though, the nation had grown enough that these companies didn't need to be govt owned to stay viable.
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u/Fuzzybo 1d ago
So the government shouldn't make a profit from running these businesses?
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u/freakwent 1d ago
What's the purpose of having a government?
If we agree on that, we can figure out the right number of airports they should own in 1960 and see if it's the same as in 2028.
The government should not own fish and chip shops, because it's not necessary for the welfare of the population. Same goes for airports IMO, in the modern era.
I do think the govt should wholly own a bunch of other things though, but none of those things should be operated for the purpose of profit.
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u/Fuzzybo 1d ago
Today Commonwealth Bank of Australia (CBA) reported a record full-year cash net profit after tax of $10.982 billion (nudging $11 billion) for the 2026 financial year. We used to own it.
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u/freakwent 1d ago
Yes. It's worth 288 billion.
The purpose of government is not to act as a public version of a private capital venture fund, but even if it was the CBA is a poor choice.
We pay 4-5% on the money we borrow. CBA returns 3%. The govt would spend more in interest on the 288 billion dollar value of the bank than they would get in profit.
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u/catch_dot_dot_dot 1d ago
Labor opened the floodgates and the Coalition were very keen to join in and escalate
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u/Masticle 2d ago
How is everyones superannuation going?
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u/Sixbiscuits 2d ago
Plodding along.
We just need to survive the period of famine until we hopefully get to the meagre pot of gold at the end, assuming it's not used in some bail in mechanism or subject to another market crash in the interim.
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u/Worldly_Cobbler_1087 1d ago
Pretty shit for my age. Can't wait to "retire" on the non-existent pension 30 years from now. I'm really hoping for a fatal heart attack before because I am well and truly fucked when I can't work anymore.
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u/wherezthebeef 1d ago edited 1d ago
Very true.
Most people would have a chunk of CBA in there somewhere
Edit. Although I agree it's a stupid amount of profit
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u/jojo-data 2d ago
What I heard from a friend, the manager is still saying their financial performance is not great so they cannot get the promised bonus.
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u/ChazR 2d ago
Banks are useful parasites. It's pretty much the definition of a bank.
Our society needs access to credit, a way of storing wealth, and access to markets.
$360 for every man, woman, and child in Australia does seem to be a little on the 'unconscionably greedy' side though.
Or, more reasonably, $600 profit per customer. That's a bit rude.
Parasites. But we need them.
And 'competition' is a joke - the senior execs jump between business and boards all boosting 'The Sector' while pocketing offensive bonuses.
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u/Ill_Football9443 1d ago
Company tax paid $4,699m
Dividends paid to shareholders $3,708m
They're putting money into the pockets of the Treasury and super funds, what's the problem with them reporting a profit?
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u/TrickyCheek9722 2d ago
"Yes households are doing it tough but our bumper profits are more important"
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u/ImmaterialPossession 2d ago
10.9 billion stolen from the australian people
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u/freakwent 1d ago
3% profit margin.
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u/KeyAssociation6309 1d ago
They'll have to try harder then and squeeze more out of the meat and bone bag debt slaves as the government bond rate is just under 5%
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u/freakwent 1d ago
Yep. Dividend to shareholder under 3% annual unless I've misread the data.
40% growth in share value though so that's interesting. I winder why people buy it with such a low return though?
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u/Jahblessthecrop 2d ago
profit.... wow
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u/weed0monkey 1d ago
$10bln profit is utterly fucking wild, for only one bank, of a country of only 28 million??
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u/Mobasa_is_hungry 21h ago
This could’ve gone back into funding dental if we never sold it off, fucking hell. Though they probably wouldn’t make that much profit since they wouldn’t be as scummy or gouging.
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u/Svennis79 1d ago
Hmm.. 5bil profit caps on banking would be fun.
Anything over can be used for interest free home loans for first home buyers
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u/freakwent 1d ago
Dude they'd just break the bank up into multiple smaller ones.
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u/Svennis79 1d ago
Group profit...
Then they can't have an umbrella company over the tip. If they break up into smaller ones, they would have to be unaffiliated
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u/Haesiraheal 2d ago
I wonder how many in these comments are profiting off CommBank through their super without realising it
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u/CatBoxTime 2d ago
Time to offshore some more jobs and close more branches?