The Commonwealth Bank of Australia (ASX: CBA) share price and the ASX 200 (ASX: XJO) both had a positive year, delivering capital growth and dividends.
However, one was the clear winner and may have been because of just one result.
Capital gains
It was a pleasing year for a lot of Australian investors because the share price of Commonwealth Bank and the ASX 200 both rose in 2025.
The Commonwealth Bank share price increased by 4.6% and the ASX 200 climbed by 6.25%. That’s noticeable outperformance and I think it’s worthwhile to see why CBA underperformed.
The ASX bank share was outperforming until November when CBA announced its FY26 first quarter. It was up around 16% for the year, at that stage.
For the ASX 200, the index was driven by strong performance of the large miners such as BHP Group Ltd (ASX: BHP) shares rising by 13.8% and Fortescue Ltd (ASX: FMG) going up 17%.
Weak profit growth
In the first three months of FY26, to 30 September 2025, CBA revealed a cash net profit of $2.6 billion.
While that sounds like a large number, it didn’t show as much growth as investors were hoping. The cash net profit was only up 2% year on year. It was only up 1% year on year compared to the FY25 second half quarterly average. It was priced for more growth than that.
Commonwealth Bank reported that operating income increased 3%, driven by lending and deposit volume growth and higher non-interest income.
However, the net interest margin (NIM) – a measure of profitability of the lending – has reduced, with underlying NIM suffering from deposit switching, competition and the lower RBA cash rate environment.
Underlying operating expenses grew by 4% due to wage and IT vendor inflation.
Could 2026 be better for Commonwealth Bank shares?
The ASX bank share did report a couple of pleasing elements that could suggest 2026 could promising.
Its loan growth rate was solid, but the reduction of the NIM was a headwind for net interest income. Commonwealth Bank reported year on year growth of 10.4% for business lending, 9.5% for household deposits and 6.1% for home lending.
CBA said its volume growth saw improved momentum across home lending and household deposits in the quarter. Retail transaction accounts increased by more than 175,000 in the quarter, primarily thanks to new-to-bank account openings.
Considering the ASX bank share’s own channels account for 68% of new lending for home loans, the growth of new transaction accounts suggests ongoing success for the bank.
In terms of the potential dividend, the independent forecast on Commsec suggests investors in Commonwealth Bank shares could receive an annual dividend of $5.25 per share. That translates into a dividend yield of 4.6%, including the bonus of franking credits.
However, it’s not one of the first ASX dividend shares that I’d buy today.
