Australia's biggest company has hit out at the dismal state of federal politics and warned the country faces a "significant economic threat" if action isn't taken to address sagging business confidence.
After announcing a record $4.62 billion half-year profit, Commonwealth Bank boss Ian Narev on Wednesday said while the economy was fundamentally sound, the outlook was being clouded by weak consumer and business confidence which was hurting spending and investment.
And he lay the blame squarely at Canberra's feet, saying important policy discussions had been crowded out by the turbulent political climate of recent years.
"You do clearly need certainty in order to make real progress and I think the political position in Canberra for some time now has not been conducive to that kind of stable policy making on infrastructure, competitiveness, foreign investment and trade," he said.
"What we are really hoping is that ... we get to an environment where the very capable people on both sides of politics can spend their time debating about really good policy in those areas."
Mr Narev said if businesses lacked the confidence to borrow money and invest, it would be harder to create jobs and grow an economy still dealing with the end of the mining boom.
"Weak confidence is a significant economic threat," he said.
"I'm by no means saying that if that isn't fixed in the next week or two we are on the verge of a real economic downturn but by definition policies take a while to work and the time to get those policies articulated and understood is now."
The Commonwealth Bank is Australia's largest company, based on its current share price which gives it a market capitalisation of more than $150 billion.
CBA lifted its first half cash profit eight per cent to $4.62 billion, which was ahead of analyst expectations.
Net profit, which includes one-off items, was also up eight per cent to $4.54 billion.
The bank lifted its fully franked interim dividend 15 cents to $1.98.
Earnings from CBA's core retail banking division, which includes home lending, credit cards, personal loans and the like, rose 12 per cent to $1.99 billion, business banking earnings lifted eight per cent to $743 million.
The bank's net interest margin, a measure of the profit it makes on loans, fell two basis points to 2.12 per cent, but net interest income rose six per cent.
Commonwealth Bank shares fell 73 cents to $91.86.
OptionsXpress market analyst Ben Le Brun said the sell-off wasn't surprising given the stock's strong rally in the past week.
"There was always going to be pressure on CBA given they are trading around record highs. It's almost like Icarus going a little too close to the sun," he said.
"The results are probably a little better than expected; investors are just crystallising some profits today."
CBA'S RECORD 1ST HALF
* Cash profit of $4.62b, up 8.0pct from $4.41b in 2013/14
* Net profit of $4.54b, up 8.0pct from $4.42b
* Fully-franked interim dividend of $1.98, up from $1.83
