Commonwealth Bank mortgage arrears 90 days or more past due climbed 7 basis points during the September quarter to reach 0.80%, The Nightly reported. Variable home loan rates at the bank will rise by the full 25 basis points from 13 November.
CBA said the rise in home loan arrears reflected cost-of-living pressures and slower resolution of overdue accounts following earlier pauses in late-stage collections. Chief executive Matt Comyn said higher inflation and interest rates are applying uneven pressure across household incomes and business activity, though he described the Australian economy as resilient despite slowing growth.
Home loan application volumes fell 16% compared with the same quarter a year earlier across CBA and its Bankwest brand, wider than the 15% drop the bank reported with its full-year result in August. During the three months to 30 September, CBA funded $44 billion in new home loans. The bank holds around 25% of the Australian home loan market, with approximately 1.9 million accounts.
Personal loan arrears fell 6 basis points to 1.66%, while credit card arrears held steady at 0.73%. Total operating income rose 3%, driven by a 4% gain in net interest income, partially countered by a 5% decline in other operating income tied to softer Markets trading results.
Collective provisions rose by $105 million in the quarter, with total provisions held flat at $6.5 billion. CBA said lower house prices on the mortgage portfolio drove the increase.
Corporate non-performing exposures increased by $200 million, attributed to rating downgrades on a small number of individual names, partially offset by a $100 million reduction in troublesome exposures. By sector, non-performing exposures in commercial property climbed from $238 million to $345 million, and in construction from $261 million to $300 million.
Variable rate home loan borrowers with CBA will face higher repayments from 13 November as the bank passes on the 25 basis point rate increase.
Reporting: The Nightly, Business News Australia, The Motley Fool Australia
Written by Pick & Scroll News from the reporting and documents linked above.
