3Q26 Trading Update – Flat revenue, soft capital, limited upside

Research evidence excerpt

3Q26 Trading Update – Flat revenue, soft capital, limited upside

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and inline with VAe. This reflected higher cloud computing volumes, software licencing

Chart 1 - CBA - Absolute PER (x)

and tech investment, which was partially offset by lower day count, weaker NZ$, timing 35

benefits and productivity savings. 3025

205. Bad debts, asset quality and provisioning: BDDs increased to 12bp of total loans, on

higher collective provisions (CP). CBA lifted its CP coverage (+3bp/CRWA vs Dec-25), 1510

maintaining peer leadership, on: i) revised macroeconomic forecasts, ii) increased 50

weighting to downside economic scenario. Underlying credit conditions moderated May-16 Nov-16 May-17 Nov-17 May-18 Nov-18 May-19 Nov-19 May-20 Nov-20 May-21 Nov-21 May-22 Nov-22 May-23 Nov-23 May-24 Nov-24 May-25 Nov-25

slightly, with higher i) consumer arrears, and ii) Corporate troublesome & non-performing . Historic Average +/- 1 standard deviation

exposures (reflecting single name exposures). Source: Bloomberg, Jefferies research

6. Capital: The CET1 ratio of 11.6% was below the run rate implied by our prior Chart 2 - CBA - PER (x) relative to bank index

2H26E. Underlying RWA was a 34bp drag, on balance sheet growth and higher IRRBB (%)

requirements, though this should unwind as embedded gains reduce. CBA completed the 6050

purchase of on-market shares to neutralise its 1H26 DRP. 40

7. Outlook: Management noted higher rates and energy prices remained an impost on 3020

household and businesses, while the Middle East conflict has clouded the outlook. 10

We move EPS by 0%/+1%/+1% for FY26/27/28E but reiterate our Underperform May-16 Nov-16 May-17 Nov-17 May-18 Nov-18 May-19 Nov-19 May-20 Nov-20 May-21 Nov-21 May-22 Nov-22 May-23 Nov-23 May-24 Nov-24 May-25 Nov-25