SYDNEY, Aug 9, 2023 (BSS/AFP) - Australia's biggest lender Commonwealth Bank reported a record annual profit Wednesday as it raked in money from customers forced to pay higher interest rates.

After-tax cash profit climbed six percent from a year earlier to Aus$10.2 billion (US$6.6 billion) in the 12 months to June 30, the bank said.
Commonwealth Bank said the interest it received from borrowers exceeded the returns it paid to savers.

Net interest income rose 18 percent, said the bank, which is also Australia's biggest mortgage provider.

Australia's central bank has been pushing up official interest rates for 15 months to curb inflation.

Commonwealth Bank nevertheless sees the "tailwinds of a recovery" in the economy with a rising population, high commodity prices and low unemployment, said chief executive Matt Comyn.

"However, there are signs of downside risks building as rising interest rates have a lagged impact on mortgage customers and other cost of living pressures become a financial strain for more Australians," he said.

The bank was keeping a close eye on the impact on businesses of people tightening non-essential spending, Comyn said.

Australia's central bank held the key interest rate at 4.1 percent last week, following a string of rises aimed at taming runaway prices. Annual inflation was 6.0 percent in the June quarter.