How does the CBA dividend compare with other ASX 200 banks right now?

Find out whether CBA holds the mantle as the top yielding dividend pick among ASX 200 bank shares.

| More on:
Hand of a woman carrying a bag of money, representing the concept of saving money or earning dividends.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

For many years, the Commonwealth Bank of Australia (ASX: CBA) dividend has boosted the wealth of millions of Aussies as one of the most popular shares held among individuals and super funds. But does it still make sense for those on the hunt for the best income?

At the final bell on Wednesday, shares in Australia's largest retail bank finished 0.4% lower at $101.70. Meanwhile, the S&P/ASX 200 Index (ASX: XJO) fell a deeper 0.74% during a rough day for materials.

Based on the closing price, CBA shares now trade on a trailing dividend yield of 4.3%. For context, the dividend yield of the ASX 200 benchmark is calculated to be 4.1%. So, already, shareholders know the CBA dividend is generating a higher return than the broader index.

However, is it competitive against other ASX 200 bank shares?

Which ASX 200 bank pays the most?

I've compiled a list of all the ASX-listed banks that are included in the ASX 200 index. It turns out there are only ten bank shares among the top 200 listed companies. It is a small collection considering the sector's enormous composition in the benchmark based on market capitalisation.

A quick inspection of the table below shows CBA does not currently offer the highest dividend yield. As a matter of fact, we must work our way down to the eighth spot on the list to find the gold-emblazoned bank.

ASX-listed bankShare priceDividend yieldPayout ratio
Bank of Queensland Ltd (ASX: BOQ)$5.777.6%132%
Bendigo and Adelaide Bank Ltd (ASX: BEN)$9.106.6%69%
Virgin Money UK (ASX: VUK)$3.136.2%36%
Westpac Banking Corp (ASX: WBC)$21.526.2%73%
ANZ Group Holdings Ltd (ASX: ANZ)$25.386.1%63%
National Australia Bank Ltd (ASX: NAB)$28.985.5%68%
Suncorp Group Ltd (ASX: SUN)$13.764.4%66%
Commonwealth Bank of Australia (ASX: CBA)$101.624.3%75%
Macquarie Group Ltd (ASX: MQG)$171.934.2%55%
AMP Ltd (ASX: AMP)$1.283.9%-333%
Data as of 3pm AEST 13 September 2023

The top spot, instead, goes to the Bank of Queensland — touting a gargantuan dividend yield of 7.6%.

However, with a payout ratio of 132%, it appears the Brisbane headquartered bank paid out more than it earned in the last year. This means future payments of a similar size may be in jeopardy in the future unless the bank can increase its earnings.

Interestingly, all of the other Big Four peers outcompeted CBA on dividend yield. The highest being Westpac, with a yield of 6.2%. Moreover, they are all carrying lower payout ratios than big yellow.

Is the CBA dividend yielding more than it did in the past?

For the diehard CBA shareholders, comparing the banking giant to itself might be more helpful.

At its current 4.3%, the Commonwealth Bank is offering its poorest yield in more than 18 years (excluding COVID). The last time the CBA dividend was even close to this low yield was in 2007, when the world was in the grips of the global financial crisis.

Yet, the bank is paying the most in annual dividends per share in its history.

How does that stack up?

Essentially, the CBA share price has outrun its dividend growth, compressing its yield.

Created with Highcharts 11.4.3Commonwealth Bank Of Australia PriceZoom1M3M6MYTD1Y5Y10YALL12 Sep 201813 Sep 2023Zoom ▾Jan '19Jul '19Jan '20Jul '20Jan '21Jul '21Jan '22Jul '22Jan '23Jul '232019201920202020202120212022202220232023www.fool.com.au

As of right now, CBA shares trade on a price-to-earnings (P/E) ratio that has only been witnessed briefly in 2021, 2019, 2010, and 2007.

Motley Fool contributor Mitchell Lawler has positions in Commonwealth Bank Of Australia and Macquarie Group. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group. The Motley Fool Australia has positions in and has recommended Bendigo And Adelaide Bank and Macquarie Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Bank Shares

A young woman sits at her desk in deep contemplation with her hand to her chin while seriously considering information she is reading on her laptop.
Dividend Investing

Are CBA shares still a good buy today for passive income?

Looking to earn passive income from ASX dividend stocks? Here’s my take on CBA shares.

Read more »

Shocked office worker staring at computer screen with colleagues working in the background.
Bank Shares

The ASX bank share beating CBA in 2025

Many investors might not realise this smaller bank stock is leading the pack this year. 

Read more »

man thinking about whether to invest in bitcoin
Bank Shares

Here's what needs to happen for the CBA share price to try and reach $200

What could drive the CBA share price higher?

Read more »

A young woman sits at her desk in deep contemplation with her hand to her chin while seriously considering information she is reading on her laptop.
Bank Shares

Why now could be an opportune time to sell CBA shares

A leading expert offers his verdict on the outlook for CBA shares.

Read more »

A man holding a cup of coffee puts his thumb up and smiles while at laptop.
Bank Shares

The Westpac share price is a buy – UBS

The broker is optimistic on Westpac shares.

Read more »

Bank building with the word bank on it.
Bank Shares

The biggest buyers and sellers of ASX 200 bank stocks revealed

Macquarie breaks down who’s been buying and who’s been selling the ASX 200 bank stocks.

Read more »

A young woman sits with her hand to her chin staring off to the side thinking about her investments.
Resources Shares

Should I switch my ASX 200 banking stocks for ASX 200 miners before earnings season?

The ASX 200 Index is dominated by Australia's bank and materials/mining sectors, which together account for around half of the…

Read more »

A man sits in contemplation on his sofa looking at his phone as though he has just heard some serious or interesting news.
Bank Shares

Here's when Westpac says the RBA will now cut interest rates

The RBA surprised everyone by keeping rates on hold last week. So, when will the next cut happen?

Read more »