History of the Commonwealth Bank of Australia
The Commonwealth Bank of Australia is an Australian multinational bank with businesses across New Zealand, Asia, the USA and the UK. Commonly referred to as the Commonwealth Bank, CBA and Commbank, the bank provides a range of financial services including retail, business and institutional banking, funds management, superannuation, insurance, investment and broking services.
CBA was founded in 1911 by the Australian government and first listed on the Australian Securities Exchange (ASX) on 12 September 1991 at an IPO price of $5.40 per share. Since becoming fully privatized in 1996, CBA has become the largest bank in the Southern Hemisphere with more than 800,000 shareholders and 52,000 employees.
CBA Share Price Return
When measuring the return of a company, it is important to take two components into account:
- Capital growth
- Dividend growth
Capital growth refers to a rise in the share price or increase in the value of the stock over time.
Dividend growth on the other hand refers to an increase in the payment of profits made by the company to shareholders.
Share investors can sometimes elect into a Dividend Reinvestment Plan (DRP) where instead of receiving dividend payments in cash, these payments are directly reinvested in the underlying equity and the investor obtains more shares. Sometimes reinvesting your dividends to buy more shares can lead to greater returns compared to simply receiving the dividends in cash.
For example, let’s look at 2 scenarios:
- Alice and Bob buy 100 shares of CBA on 31 May 2010 at a price of $48.37
- Alice chooses to receive dividends as cash payments, and Bob elects into a dividend reinvestment plan
- Both Alice and Bob sell their shares on 30 June 2017 at a price of $83.73
Bob’s choice to reinvest his dividends earned him a total return $9,898.69 – approximately 35% greater than Alice’s total return of $7,289.50!
As you can see from CBA’s chart above, early long-term investors in CBA shares have made a pretty decent return on their investment! Since originally listing on the ASX at $5.40 per share in September 1991, CBA has reached an all-time high of $95.92 in March 2015! Now trading at around $73 per share, CBA is the largest share on the ASX by market capitalization and the number one share in the ASX 200 index.
When measuring dividend growth, we need to consider the Dividend Per Share (DPS) which is simply annual dividends paid divided by the number of shares outstanding. We also need to consider Dividend Yield, which is calculated by dividing the annual dividend by the current stock price. A stock’s dividend yield is expressed as a percentage (%) and can be thought of as an “interest rate” earned on an investment.
By looking at the chart above, we can see that CBA’s DPS has been increasing year to year, although the rate of increase has slowed, particularly since 2015. For the last 10 years, CBA has seen its dividend yield range between 4.9% and 6.6%, currently offering a yield of 5.91%.
Selling Your CBA Shares
Selling your CBA shares with us is quick, safe and easy – all you need to do is follow the steps below.
The first step is completing an online form on our website, which can be accessed by clicking the “Sell Shares Now” button on the top right of our homepage. This form takes about 5 minutes to complete and is performed completely online – no printing necessary!
After completing the form, you will then receive an email with a link inside which looks like this:
Clicking on this link will take you to another short online form which asks you to:
- Accept the terms and conditions
- Confirm your identity by leaving us a short voice message
- Complete an online ID check – no scanning or uploading required!
Once that’s complete, we will process your submission and proceed to sell your shares for you.
There are instructions each step of the way, and the whole process shouldn’t take you longer than 15 minutes tops! If you need any assistance during the process, don’t worry – our friendly staff are available during weekday business hours to help you over the phone.
When Will You Receive the Money from Selling Your CBA Shares?
All share sales in Australia are settled on a T + 2 basis. This means that we receive the funds from your share sale 2 business days after the sale. We then transfer the funds to your bank account (or post a cheque). This means that you will receive your share sale funds 3 business days after your share sale. For example, if Alice sells her CBA shares on Wednesday, she will receive her funds on Monday the very next week.
How Much Will it Cost to Sell Your CBA Shares?
Our standard brokerage fee for the online sale service is $110 + GST per share parcel (company). If the shares are worth more than $10,000, then the brokerage fee will just be 1% of the total value of the shares. Our brokerage fee is taken out of the share sale proceeds before they are transferred to your bank account, so there are no up-front costs.
Who is Sell My Shares?
Sell My Shares was founded in 2013 by two stockbrokers who noticed that there were very few options available for people who just wanted to sell their shares with minimum fuss besides opening a full service stockbroking account.
We also noticed that most stockbrokers dreaded the phone call from an ‘accidental’ investor who just wanted to make a “one-off share trade”. Historically, this type of business has been shunned by the industry because it is labor intensive and, by its very nature, one-off. Stockbrokers would much rather have clients who actively trade shares – day in, day out.
We decided to love this type of business, and these clients, and that’s what we do – very well.
Whether you have one small share parcel to sell, or if you want to sell down a $5m inherited portfolio, we will make it as simple as possible and treat you with equal respect.
We also specialise in complex matters such as deceased estates, shares held by companies, trusts, SMSFs or combinations thereof, regardless of whether the shares are held on SRN or HIN (or even if you don’t have a clue what that means). You name it, we can sell it – provided it’s ASX listed.
And remember, we are real people – see!
If you have any questions at all, or need assistance while completing our online share sale form, please feel free to call Jason, Steve, Teresa or Ryan – our number is 1300 722 852.