A major bank has beaten profit expectations on its way to a $7bn year, but has still claimed challenging conditions.
Commonwealth Bank has released its March quarter update, taking in cash earnings of $1.75bn. The result was ahead of analysts' expectations of $1.7bn.
In spite of the bumper result, the bank pointed to "subdued credit demand and elevated funding costs", saying they had impacted revenue growth. CBA also said higher funding costs had proven a drag on net interest margins.
Commonwealth chief executive Ian Narev said the bank had positioned itself for an "uncertain outlook".
"Consistent with the uncertain outlook that we indicated at the Group's half year results in February, we have retained our conservative business settings, including tight expense control, a conservative funding profile and strong provisioning levels," Narev said.
CBA">Major slashes fixed rate pricing to three-year low