Commonwealth Bank of Australia · ASX:CBA
Commonwealth Bank of Australia — H1 2003 Earnings Presentation
12 slides from Commonwealth Bank of Australia's earnings presentation, Feb 12, 2003
Slide 1: Half Year Results Presentation to Media
Half Year Results Presentation to Media David Murray 12 February 2003 www.commbank.com.au
Slide 2: Economic environment
Economic environment Challenging operational environment Global: Political and economic uncertainty Continued declines in equity markets Domestic: Drought consequences affect economy Housing cool-down likely to halt wealth effect Subdued business credit demand continues Half Year Res
Slide 3: The Bank's key objectives in this environment
The Bank’s key objectives in this environment Respond to customer and shareholder demands and preserve combination of quality, security and stability Customers: Access: reliability Service: improving quality standards Shareholders: Security: prudent capital and credit quality management
Slide 4: Providing shareholder income: Slight increase in cash profit
Providing shareholder income: Slight increase in cash profit… Dec 2002 Dec 2001 % Change Statutory Net Profit After Tax $622m $1,204m (48%) Net Profit After Tax (cash basis)* $1,208m $1,192m 1% Earnings per Share 95cps 94cps 1% * ie excluding appraisal value uplift/reduction and goodwill amortisatio
Slide 5: Resulting in the highest dividend payout ratio among major banks
Resulting in the highest dividend payout ratio among major banks Dec 2002 Dec 2001 Change Dividends per Share 69cps 68cps 1% Dividend Payout Ratio 72.7% 72.6% - 150 82 75 125 72 66 100 58 57 C e n ts 52 75 46 68 69 36 58 61 50 46 49 22 45 36 38 25 24 20 0 1993 1995 1997 1999 2001 2003 First Half Sec
Slide 6: Divisional breakdown: Sound growth in Banking offset by weaker Wealth Management
Divisional breakdown: Sound growth in Banking offset by weaker Wealth Management Net Profit After Tax Change 31 Dec 02 30 Jun 02 31 Dec 01 YoY% Banking $1,079m $1,092m $975m 11% Funds Management $135m $186m $182m (26%) Life Insurance ($6m) $31m $35m (117%) Retail banking strong, business and corpo
Slide 7: Providing shareholder security: Capital Adequacy
Providing shareholder security: Capital Adequacy Capital position remains strong Hybrid note issue and share buyback on hold Regulatory Target Capital: Tier 1: 6.5% - 7% Total Capital: 9% - 11% 31/12/02 30/6/02 31/12/01 Actual Capital: Tier 1 7.06% 6.78% 6.75% Tier 2 4.08% 4.28% 4.27% Less Deduc
Slide 8: Colonial merger – a situation update
Colonial merger – a situation update Growth in asset value: Maintained value of life insurance Added value to funds management Banking: Integration synergies achieved ahead of schedule Higher risk / lower quality assets divested: United Kingdom - life insurance and private client business Thailand,
Slide 9: Appraisal value
Appraisal value Conservative approach, based on external market conditions: Market volatility and uncertainty Lower industry funds flows Result: Reduction in underlying appraisal value of $426 million Lower by $780 million than independent valuation Consistent with valuation in June 20
Slide 10: Results flow from Bank strengths
Results flow from Bank strengths Higher profits despite continued weakness of environment made possible by: Disciplined adherence to service improvement Experience in managing difficult conditions Active implementation of sound strategy Half Year Results 12 February 2003 10
Slide 11: Outlook - General
Outlook - General Global situation remains uncertain: Political tension Economic weakness Fragile equity markets Domestic situation less supportive: Economy holding up well, but likely to slow Competitive industry pressures Half Year Results 12 February 2003 11
Slide 12: Outlook - Bank
Outlook - Bank Continued focus on service, income and security Commitment to sustainable business growth, strong credit quality standards and high dividend pay-out ratio through growth in cash earnings Strategic positioning to benefit from any improvement in external conditions Continued eff
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