Is the Commonwealth Bank (ASX:CBA) share price a buy after falling 10% in a week?

Core Viewpoint - The Commonwealth Bank of Australia (CBA) has experienced a 10% decline in share price following its quarterly update, raising questions about whether it is a good time to buy [1]. Financial Performance - CBA reported a cash net profit increase of only 2% year-on-year, which was considered disappointing [2]. - Business lending grew by 10.4%, household deposits increased by 9.5%, and home lending rose by 6.1%, indicating solid lending growth [2]. - The reduction in headline net interest margin (NIM) and increased operating expenses due to wage and IT vendor inflation contributed to the modest profit growth [2]. Loan Quality and Balance Sheet - CBA's loan impairment expense was $220 million, with a sound loan portfolio and lower consumer arrears [3]. - The percentage of troublesome and non-performing loans decreased to 0.94%, down from 0.97% at the end of FY25 and 1.07% in September 2024, indicating a positive trend [3]. - The bank maintains strong balance sheet settings [3]. Competitive Landscape - The banking sector is highly competitive, with Macquarie Group Ltd rapidly gaining market share [4]. - CBA benefits from a larger proportion of new loans originating through its own channels rather than brokers, which supports its NIM and lending growth [4]. Valuation and Dividend Yield - CBA is often regarded as one of the most expensive banks globally, but its share price has become more attractive after the recent decline [5]. - The bank is considered high quality, but its dividend yield of 3.1% without franking credits and 4.4% with franking credits is not particularly appealing compared to other ASX dividend shares [5].