In morning trade, the Commonwealth Bank of Australia (ASX: CBA) share price is down slightly at $107.53.
Despite this, the banking giant's shares are on course for a positive monthly gain of approximately 3%.
In fact, things have been so positive this month, the CBA share price managed to hit a 52-week high of $109.20 at one point.
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Why did the CBA share price hit a 52-week high in November?
Investors were bidding the CBA share price higher in November thanks largely to the release of a solid first quarter update in the middle of the month.
For the three months ended 30 September, Australia's largest bank reported a 2% increase in cash earnings over the second half average of FY 2022 to $2.5 billion. This was driven by a 9% lift in operating income, which was offset partially by a 4.5% increase in expenses due largely to wage inflation.
The bank's solid operating income growth was underpinned by higher margins and volume growth, which offset a reduction in non-interest income. The former reflects household deposit growth of 8.6%, home lending growth of 6.3%, and business lending growth of 12.6%.
And while the banking giant surprisingly decided not to reveal what its net interest margin (NIM) was during the period, Goldman Sachs estimates that it came in at between 2.05% to 2.10%.
This was a big positive given that the broker was forecasting a first half NIM around 10 basis points lower than this. Especially given how interest rate hikes are likely to support a further increase in its NIM during the second quarter.
Goldman commented:
CBA did not provide a NIM for the quarter; however, we note that net interest income was very strong at +16% vs 2H22 average and was run rating 5.5% above our 1H23E forecasts. Based on current GSe balance sheet forecasts, and the fact liquids seem to have grown stronger than loans in the quarter, we estimate a 1Q23 NIM of between 2.05% to 2.10% (which is >10bp higher than our current 1H23E), with its trajectory into 2Q likely still higher.
All in all, a positive month for the bank and its shareholders will no doubt be hoping for more of the same from the CBA share price in December.
