CBA boss Matt Comyn says regional areas faring well despite sticky inflation, labour shortages

CBA’s chief executive says many regional communities are navigating lingering cost pressures well and expressing optimism, despite grappling with persistent labour shortages.

CBA boss Matt Comyn noted that fears about low rainfall levels in 2024 hadn’t eventuated, resulting in yields from a number of crops coming in above expectations.

Commonwealth Bank chief Matt Comyn says many regional communities are coping with lingering cost pressures and expressing optimism about the period ahead, despite facing persistent labour and skill shortages.

Speaking ahead of this year’s National Bush Summit beginning in Townsville on Friday, Mr Comyn said loan arrears in regional areas were slightly better or in line with their metropolitan counterparts, buoyed in part by favourable conditions in the agricultural sector.

“When you’re able to come through a more a difficult period you’ve got more confidence you can weather that, and you have to be more focused on a more optimistic path and innovation,” he said. “To perform well you need productivity to try to take advantage of improvements in technology or agricultural practices, to weather and strengthen an individual but also the region’s ­outlook.”

Mr Comyn noted that fears last year about low rainfall levels in 2024 hadn’t been realised, resulting in yields from a number of crops and industries coming in above expectations.

“Nine or 12 months ago there was a lot of pressure on lamb prices, on beef prices. They’ve improved, so I think overall yields and prices for a lot of our agricultural customers – they’re having a pretty good year,” he said.

Mr Comyn’s comments follow the bank’s annual profit results last week which suggested an improved outlook for the construction and agriculture sectors.

They also aligned with a CBA survey that showed manufacturers and distributors in regional areas were more optimistic than their counterparts in other locations about matters such as ­production output and lifting ­productivity.

The CBA survey drew on responses from almost 500 manufacturers and distributors across Australia.

CBA chief executive Matt Comyn, third from left, in Townsville with business banking executive manager Donna Astbury, executive general manager of regional and agribusiness Paul Fowler and Professor Ajay Rane of the Mater Hosptal.

Mr Comyn identified labour and skill shortages among the most pressing issues confronting businesses in regional Australia.

“The main things … demand for labour and the availability of some of the specialist skills that will be required over the next five or eight years,” he said. “That’s against the backdrop of higher cost of living, hopefully that’s more of a temporary challenge.”

In the CBA survey, regional manufacturers and distributors cite a lack of skills and labour as their biggest barriers to productivity. Ineffective operating systems are also a concern.

Mr Comyn said anecdotal evidence suggested many regional communities were embracing the economy’s transition to lower- emission energy sources.

“The economy is diversified and the population is as well, and there seems to be good support for the sorts of projects that will no doubt build job opportunities and prosperity for the region,” he said. “Particularly in the energy space, there’s a lot of optimism around some of the new and emerging technologies.

“There are some large-scale projects and significant investments to be able to bring those projects onto the grid.”

In some parts of Australia, however, farmers are challenging the bigger push towards renewable energy.

Victorian farmers last month hit out at the Allan government for forcing regions to carry the burden of its renewable energy targets and ignoring concerns its transition plan could compromise food security.

While visiting CBA customers in Townsville, Mr Comyn observed the city’s growth fundamentals were “very strong”.

“There’s a big pipeline of projects. They’ve got a big exposure to grow in sectors like energy, mining, defence, healthcare,” he said. “That’s a great story and message to see outside of the key metropolitan cities.

“There are similar trends as there are other parts of the country and certainly cost of living is a pressure across every part of the country that we serve.”

Mr Comyn made a visit to the Mater Hospital while in Townsville to view the application of robotics technology in surgeries.

Asked about a recent selldown in his direct CBA holding, outlined in an ASX director’s notice, Mr Comyn said it primarily related to an obligation to pay tax on the vesting of share awards.

“I’m more than three times over the mandatory shareholding requirement,” he said.

Mr Comyn’s direct holding in fully paid CBA shares fell to 30,783 on August 15, from 50,003 previously.