CBA Lifts Mortgage Lending 7.1% as Arrears Tick Higher

Australia's largest bank grew its mortgage book by $41.2bn in a year, but rising arrears and fresh provisions signal growing household stress.

Commonwealth Bank of Australia has released its third-quarter update for the 2026 financial year, and the numbers tell two stories at once. Lending volumes are rising strongly, but credit stress is becoming easier to see in the data. For borrowers, both sides of that picture matter.

CBA's Mortgage Book: Strong Growth, Disciplined Lending

CBA's home lending balances grew 7.1 per cent over the 12 months to March 2026, adding $41.2 billion to the bank's mortgage book compared with the same period a year earlier. The bank advanced $45 billion in new home loans during the March quarter alone — a pace that underscores how active the refinancing and purchase market remains despite higher interest rates.

The Adviser reports that CBA described this as "disciplined growth," with the bank emphasising that the expansion was not driven by aggressive rate discounting or looser credit criteria. Business lending also outpaced broader industry growth, with balances rising 12.5 per cent year-on-year to add $21.6 billion. Household deposits climbed 9.1 per cent — or $38.3 billion — over the same period, leaving CBA funded predominantly by deposits, which made up 79 per cent of total funding at March 2026.

Taken together, these numbers describe a banking system that is still expanding, with customers continuing to take on and service debt at scale. But CBA chief executive Matt Comyn was direct about the pressure building beneath those headline figures. "Many Australian households and businesses are navigating cost-of-living pressures from higher energy prices and interest rates," he said in the quarterly update. He also flagged geopolitical risks, noting that conflict in the Middle East is disrupting critical supply chains and contributing to global uncertainty — a dynamic the bank has weighted more heavily when setting provisions.

Arrears Are Rising — What This Means for Your Home Loan

The detail that warrants the closest attention from existing mortgage holders is what is happening to arrears. Home loan arrears rose 6 basis points during the quarter to 0.69 per cent. Credit card arrears increased 2 basis points to 0.68 per cent. The sharpest movement was in personal loans, where arrears jumped 30 basis points to 1.71 per cent — a clear indicator that more leveraged and unsecured borrowers are coming under increasing financial pressure.

CBA's loan loss rate for the quarter came in at 12 basis points, double the 6 basis points recorded across the first half of the 2026 financial year. Loan impairment expenses were $316 million, equivalent to 12 basis points of average gross loans and acceptances.

In response, the bank increased the forward-looking component of its collective provisions by $200 million — equivalent to 8 basis points of gross loans — to reflect updated macroeconomic forecasts and a higher weighting on downside economic scenarios. Total provision coverage now sits at 1.57 per cent of gross loans and acceptances. CBA posted an unaudited statutory net profit after tax of $2.6 billion for the quarter, 1 per cent below the average quarterly profit in the first half of the financial year.

That slight decline in profit, combined with rising provisions, reflects a bank moving cautiously in response to an environment it expects to remain challenging. Comyn's comments about energy prices and interest rates were not rhetorical — they are showing up directly in the arrears figures.

What Borrowers Should Do Right Now

CBA is Australia's largest retail and business lender, so when its arrears data shifts, it carries weight as a signal for the broader mortgage market. Arrears at 0.69 per cent on home loans are still low by historical standards, but the direction is upward, and that matters for how you approach your own mortgage in the months ahead.

If you are currently on a variable rate mortgage, this is a good moment to confirm whether your current product is still competitive. Banks do not automatically pass on the best available pricing to existing customers. In many cases, a review of your loan against what is currently available in the market will reveal meaningful savings — sometimes hundreds of dollars per month — that can materially reduce pressure on your household budget. Start by running the numbers through our [refinance savings calculator](/calculators/refinance-savings) to see what switching could save you.

For first home buyers assessing the market, the fact that CBA alone advanced $45 billion in new home loans in a single quarter confirms that mortgage lending is still flowing. Serviceability requirements remain in place across the industry, so understanding what lenders are likely to approve is the first practical step. Our [borrowing power calculator](/calculators/borrowing-power) can help you estimate your position based on your income, expenses, and current rate settings before you apply.

For property investors, CBA's investment and business lending is running 12.5 per cent ahead of last year — lender appetite is present, but structuring your borrowing efficiently matters more when the credit environment is tightening at the margins. Browse current [investor home loan options](/home-loans/investor) across the market to understand where the competitive rates sit today.

For anyone finding repayments harder to manage, or who simply wants to confirm they are on the best available deal for their circumstances, speaking with an accredited mortgage broker is a sensible first step. Brokers operate across the market and can help you access [a range of refinancing options](/home-loans/refinance) suited to your situation — at no cost to you.

[Read the full CBA quarterly update reporting at The Adviser](https://www.theadviser.com.au/lender/48438-cba-posts-lending-lift-as-risks-edge-higher)