Commonwealth Bank CEO Matt Comyn said home loan pricing remains “aggressive” and competition will escalate in deposit products this year, keeping the pressure on bank profit margins which have emerged as a battleground issue for investors as the Reserve Bank nears the end of its tightening cycle.

CBA said its net interest margin, being the difference between interest earned from borrowers and what it pays to savers, suffered in the second half due to loan competition and higher funding costs. But the bank still lifted full-year cash profit 6 per cent to a record $10.16 billion, propelled by higher official interest rates.