Macro Investor: CBA is not worth the risk

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Commonwealth Bank of Australia Ltd (ASX:CBA) is the nation’s largest bank, providing banking, life insurance and related services for individuals, small businesses and medium sized commercial enterprises. It also provides corporate and general banking, international financing, institutional banking, stock broking via Commsec and funds management.

On the surface, CBA looks great – record profit, improving returns, increasing book value and resilient cash flows – but underneath the impressive historic financials leading through to FY12, just reported, strong management and margins alone won’t inure it from significant macroeconomic headwinds.

Michael Feller is an investment strategist at Macro Investor. To read this analysis in full, take up your free 21 day trial.

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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.