The Commonwealth Bank of Australia (CBA) announced a record half-year cash profit of $5.45 billion for the period ending in 2025. This impressive figure comes as investor interest in the housing market intensifies, with many buyers now taking a larger share of the market from owner-occupiers. On Wednesday, the bank revealed it is settling over 3,000 housing loans weekly, as property prices reach or exceed record highs in various regions across the country.
CBA’s data indicates that residential investment lending remains robust, with investors now responsible for 43% of new business, an increase from 37% two years ago. Conversely, lending to owner-occupiers has decreased as a percentage of the overall loan portfolio. This trend highlights how established investors, leveraging their existing equity, are increasingly outbidding first-time home buyers in a highly competitive market, widening the wealth gap between generations.
Following the earnings announcement, CBA shares surged more than 7%, reflecting investor confidence in the bank’s growth in both residential and business lending. During a conference call with investors, CEO Matt Comyn stated that home loan balances had risen by 7% over the past year to $622 billion, with 97% of these customers also maintaining a transaction account with CBA. The bank’s cash profit rose 6% year-on-year, exceeding market expectations, and CBA declared an interim dividend of $2.35, an increase of 10 cents compared to the previous year.
While CBA’s profits have increased, the bank has also seen a decline in the proportion of customers falling behind on mortgage repayments. This decrease follows three interest rate cuts last year and recent tax reductions that alleviated some financial pressures on households. Nonetheless, the arrears level remains elevated, and the effects of a recent interest rate hike have yet to be fully realized in mortgage payments.
The bank’s substantial profits have drawn criticism from the Finance Sector Union, which has highlighted the increasing workloads faced by CBA employees. A survey of more than 1,700 CBA workers revealed that 72% are concerned about job security, particularly due to offshoring and the rapid adoption of automated processes.
The rising trend in investor lending is part of a broader national pattern, with banks actively pursuing the types of customers referred to by rival bank Westpac as “attractive.” Data from the Australian Bureau of Statistics indicates that investors accounted for two in five home loans issued in the final quarter of 2025. In that period, they received approximately 60,445 loans amounting to nearly $43 billion, surpassing the 57,282 loans awarded to existing owner-occupiers and nearly doubling the loans for first-time buyers, which rose to 31,783 due to a government-backed 5% deposit scheme.
CBA’s lending growth significantly exceeded expectations, particularly following last year’s interest rate cuts, according to Andrew Hauser, Deputy Governor of the Reserve Bank of Australia (RBA). He addressed the Australian Chamber of Commerce and Industry, stating that lending had remained accessible despite the central bank’s recent rate hike. “Credit growth has been … part of the stuff, I would say, that policymakers may have missed slightly,” he noted. Hauser emphasized that while some financial conditions remain supportive, the elevated cash rate will eventually have an impact.
Additionally, new borrowing limits introduced by the prudential regulator on February 1, 2025, restrict banks from issuing loans to customers with high debt-to-income ratios, capping them at 20% of total new lending. Hauser described this regulatory change as “smart design,” urging banks to lend responsibly while being mindful of sustainable credit growth levels.
In summary, the Commonwealth Bank’s record profit underscores the ongoing dynamics in Australia’s housing market, driven by a surge in investor activity and changing lending patterns. As the landscape evolves, both the bank and its employees face challenges that could shape the future of lending in the country.
