Halister News

(Bloomberg) -- Commonwealth Bank’s annual cash profit is seen rising 3.5%, according to median of 11 analysts surveyed by Bloomberg, 2H profit seen rising 4.5% h/h. Results likely to be overshadowed by questions on bank culture, CEO future after Australia’s financial crime regulator Austrac sued the bank last week over alleged money laundering breaches. ESTIMATES:

• FY cash earnings est. A$9.8b (11 analysts, range A$9.7b to A$10.0b)
• 2H cash earnings est. A$4.9b (5 analysts, range A$4.8b to A$4.9b)
• Stat. profit est. A$9.8b (7 analysts, range A$9.7b to A$9.9b)
• Net interest margin est. 2.1% (4 analysts, range 2.11% to 2.12%)
• Final div. BDVD est. A$2.34

WHAT TO WATCH:

• Deutsche Bank (hold): Expect “relatively subdued result” with underlying earnings weak. Key focus is outlook for NIMs and the extent to which bank has been able to benefit from mortgage repricing
• Morgan Stanley (underweight): Austrac action raises further concerns about conduct, with the potential for penalties, brand damage and more scrutiny. Looking for management response to allegations, as well as the composition and outlook for housing loan growth
• Bell Potter (hold): Result likely to be overshadowed by Austrac allegations, fallout will dampen CBA share price prospects for some time. Focus on growth despite margin pressure and ongoing cost discipline 
• NOTE: Money- Laundering Case Adds to Australian Banking Scandals

DATA:

• 3 buys, 7 holds, 6 sells, avg. PT A$83.42: Bloomberg data
• Shrs down 1% YTD vs ASX 200 Index up 1.9%
• Short interest of 1.4% of float, 52-wk high 2.5% in Feb., low 0.8% in May: Markit data

TIMING:

• Expected to report results Aug. 9
• Conf. call 11:00 Sydney time
• CBA is the only Australia big-four bank reporting full-year results in Aug. National Australia will give Q3 trading update Aug. 11, ANZ gives similar update Aug. 15; Westpac update on institutional business was July 28.

To contact the reporter on this story: Emily Cadman in Sydney at ecadman2@bloomberg.net