Commonwealth Bank of Australia (CBA) has released its half-year results for the period ending 31 December 2023, attributing a decrease in net profits and higher operating costs to the challenging economic environment.

The ASX-listed bank has reported net profit after tax (NPAT) of $4.8 billion, down 8% on the first half of 2023. It also reported cash NPAT dipped 3% to $5.02 billion on the same period. The decrease was attributed to flat operating income and higher operating expenses, partly offset by a lower loan impairment expense.

Over the first half, CBA’s operating income was flat at $13.65 billion, supported by volume growth and higher volume-based fee income, offset by margin compression. Operating expenses were 4% higher ($6bn) due to inflation and additional technology spend.

In the first half of 2024, CBA lent $18 billion to Australia’s businesses and helped more than 60,000 customers buy a new home. The bank paid over $1.8 billion in Australian corporate income tax in the first half of 2024.

“Australian households continue to feel pressure in the current environment, with many cutting back to adjust,” CBA’s Chief Executive Officer, Matt Comyn, said. “Throughout the half, we have continued to support our customers and communities, invest for the future, and provide strength and stability for the broader economy.”

Comyn also noted the bank’s lower cash profit reflects cost inflation and a competitive operating environment.

“2023 was increasingly challenging for many of our customers who are finding it harder to absorb cost of living pressures. The economy has been fairly resilient, supported by a strong labour market, savings and repayment buffers, population growth and relatively high commodity prices. However, downside risks are building as slowing demand and persistent inflation impact Australian businesses. Ongoing geopolitical tensions also create uncertainty,” he said.

CommBank also took the opportunity to highlight several customer achievements over the half, including lending $18bn to businesses, connecting customers to $1.2bn in unclaimed benefits, rebates and concessions, and paying over $2 million in grants to 201 community organisations through the CommBank Staff Foundation.