Five years ago, in February 2021, I could have bought Commonwealth Bank of Australia (ASX: CBA) shares for $81.56.
At the time, the world was still dealing with the fallout from COVID-19. Interest rates were ultra-low, economic uncertainty was high, and many investors questioned how quickly the major banks would recover.
Fast forward to today, and CBA shares are trading at $178.53.
That is more than a doubling of the share price in just five years.
Image source: Getty Images
A recovery that surprised many
CBA's rebound from the pandemic was stronger than many expected.
As government stimulus, a resilient labour market, and a booming housing market supported borrowers, credit quality held up better than feared. Arrears remained manageable, bad debts stayed contained, and earnings rebounded.
Importantly, CBA did not just recover. It built on that recovery.
The bank maintained strong deposit growth, disciplined lending, and continued investing heavily in technology and digital capability. Over time, that consistency translated into growing profits and reliable dividends.
Its latest first-half result, released this month, once again highlighted that resilience. Cash net profit after tax came in 6% higher at $5.4 billion and the interim dividend was declared at $2.35 per share, fully franked. Return on equity remained strong and capital levels stayed comfortably above regulatory minimums.
In short, CBA has continued to execute.
Dividends added up
Of course, the share price is only part of the story.
Over the past five years, CBA has paid the following fully franked dividends per share:
- September 2021: $2.00
- March 2022: $1.75
- September 2022: $2.10
- March 2023: $2.10
- September 2023: $2.40
- March 2024: $2.15
- September 2024: $2.50
- March 2025: $2.25
- September 2025: $2.60
- March 2026 (declared): $2.35
That is a total of $22.20 per share in cash dividends over five years.
If I had held those shares, that would have been a meaningful income stream on top of the capital growth.
So what would $10,000 have become?
Now for the numbers.
If I had invested $10,000 into CBA shares in February 2021 at $81.56, I would have bought approximately 122.6 shares.
At today's share price of $178.53, those shares would now be worth about $21,900.
That is more than double the original investment in capital value alone.
On top of that, those 122.6 shares would have generated roughly $2,720 in dividends over the past five years, based on the $22.20 per share paid during that period.
Add it together, and that original $10,000 would have effectively turned into around $24,600 in combined share value and cash dividends, before even taking franking credits into account.
Foolish takeaway
CBA has not been the cheapest bank share over the past five years. In fact, it has often traded at a premium to its peers.
But it has delivered consistency. It recovered strongly from COVID-19, continued to grow earnings, maintained strong capital, and kept rewarding shareholders.
If I had bought CBA shares five years ago and simply held on, I would likely be very pleased with the result today.
