This is not financial advice. This podcast was produced using Ai platforms, and the Ai generated voices have 'North American' (ie USA) accents.

This podcast was produced using only information from a publically available PDF document that CBA listed on the ASX website. The Ai generated 12 minute podcast provides an in-depth look at the financial performance of the Commonwealth Bank of Australia (CBA) for the half-year ended 31 December 2024.

We used an Ai platform to review the CBA 2H 2024 report; the Ai reviewed the bank's income and expenses, including net interest income and operating costs, across its various business segments like Retail Banking, Business Banking, and Institutional Banking. The report also outlined key financial metrics such as capital adequacy, loan impairment, and funding sources, alongside a discussion of the prevailing economic conditions and the bank's approach to risk management.

The report does contain detailed financial data and metrics that an equities analyst would typically use as inputs to perform a valuation analysis. Some of the key information presented in the report that would be relevant for an analyst's valuation include:
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Net Profit After Tax: The Group's statutory net profit after tax for the half year ended 31 December 2024 was $5,134 million, an increase of 8% on the prior comparative period. The cash net profit after tax was $5,133 million, a 6% increase on the half year ended 30 June 2024 and a 2% increase on the half year ended 31 December 2023. Management considers cash NPAT their preferred measure of financial performance.
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Earnings Per Share (EPS): Basic cash EPS from continuing operations was 306.9 cents, and basic cash EPS including discontinued operations was 307.0 cents for the half year ended 31 December 2024. Statutory basic EPS from continuing operations was 307.5 cents, and statutory basic EPS including discontinued operations was 307.0 cents. EPS figures are crucial for valuation methods like the Price-to-Earnings (P/E) ratio.
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Dividends: An interim dividend of 225 cents per share, fully franked, was declared. The dividend cover on a cash basis was 1.4 times. The dividend payout ratio on a cash basis was 73%. The Board considers factors like business growth, capital needs, market expectations, and EPS growth when determining dividends. Dividend information is key for dividend discount models and assessing shareholder returns.
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Return on Equity (ROE): The cash ROE for the half year ended 31 December 2024 was 13.7%. Statutory ROE was 13.8% for continuing operations and 13.7% including discontinued operations. ROE indicates how efficiently the bank is using shareholder funds to generate profit.
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Capital Position: The Bank maintained a strong capital position with a Common Equity Tier 1 (CET1) Capital ratio of 12.2% as at 31 December 2024, which is well above APRA's minimum regulatory requirement of 10.25%. Capital ratios are important for assessing the bank's stability and ability to absorb losses or fund growth.
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Net Tangible Assets (NTA) per Share: NTA per share was $40.32 as at 31 December 2024. NTA provides a book value per share, which can be used in various valuation comparisons.
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Economic and Operating Environment: The report mentions challenges for customers due to cost of living pressures and a slowed Australian economy, but notes moderating underlying inflation. These factors influence the bank's future earnings outlook and perceived risk.

To repeat. This is not financial advice. This podcast was produced using Ai tools.