Australia’s biggest bank warns weak consumer and business confidence levels are threatening the economy and has placed the problem at the feet of the Federal Government.

The Commonwealth Bank on Wednesday unveiled a record $4.62 billion half year profit but chief executive Ian Narev said confidence levels were undermining an economy still dealing with the end of the mining investment boom.

“Businesses need the certainty to invest to create jobs, and households need a greater feeling of security,” Narev said in a statement.

“That requires implementation of a coherent long-term plan that clearly addresses target government debt levels and timeframes, infrastructure priorities, foreign investment, business competitiveness policies and, above all, job creation.”

Narev also highlighted a number of positives for the economy, including the falling Australian dollar, a strong construction sector and population growth but said weak confidence remained a significant economic threat.

CBA lifted its first half cash profit eight per cent to $4.62 billion, which was ahead of analyst expectations.

Net profit, which includes one-off items, was also up eight per cent at $4.54 billion.

The bank also lifted its fully-franked interim dividend 15 cents to $1.98.

Earnings from CBA’s core retail banking division, which includes home lending, credit cards, personal loans and the like, were up 12 per cent to $1.99 billion, while earnings from its business banking operations rose eight per cent to $743 million.

The Bank’s net interest margin, a measure of the profit it makes on loans, was down two basis points to 2.12 per cent, but net interest income was up six per cent.

Commonwealth Bank shares last closed at $92.59, putting its market capitalisation at more than $150 billion.