The Commonwealth Bank of Australia (ASX: CBA) share price has fallen 10% since Monday, is this a good time to buy?
Earlier this week, CBA released its quarterly update for the three months to 30 September 2025 and investors didn’t react very well to it. Let’s remind ourselves what the biggest bank in Australia said.
Was CBA’s quarterly update disappointing?
The ASX bank share reported that its cash net profit only increased by 2% year on year, which wasn’t exactly strong.
In terms of lending and deposit year-on-year growth, business lending rose 10.4%, household deposits increased 9.5% and home lending grew by 6.1%. These numbers were solid, in my view.
So why did profit grow by so little after taking into account the reasonable lending growth?
CBA said that its headline net interest margin (NIM) reduced and operating expenses increased because of wage and IT vendor inflation. The underlying NIM was slightly lower because of deposit switching, competition and RBA rate cuts. Profitability is normally a key influence on the CBA share price.
Its loan impairment expense was $220 million, (loan) portfolio credit remained “sound” with lower consumer arrears. Its percentage of troublesome and non-performing loans declined to 0.94%, down from 0.97% at the end of FY25 and 1.07% at September 2024. This is a promising trend for CBA.
The bank also said that it maintained “strong balance sheet settings”.
Is the Commonwealth Bank share price a buy today?
The banking space is very competitive, with Macquarie Group Ltd (ASX: MQG) growing rapidly and taking market share from other banks. There are plenty of others in the lending space that would like to disrupt CBA and the other big ASX bank shares.
A key advantage that CBA has over other banks is that a larger proportion of its new loans are coming through CBA channels rather than brokers, which is helpful for CBA’s NIM and lending growth.
The CBA share price is regularly called one of the most expensive banks in the world, but it’s now a lot cheaper than it was a week ago after falling 10% since Monday.
It’s probably Australia’s highest quality bank, but still not great value and the dividend yield isn’t exciting either at 3.1% without franking credits and 4.4% with franking credits.
For now, there are other ASX dividend shares that look more appealing to me.
