Commonwealth Bank chief executive Ralph Norris says the country's biggest home loan lender will adjust mortgage rates as necessary based on its funding costs.
"I don't thing there's any doubt that we will continue to reprice where necessary," Mr Norris said told analysts in a briefing.
"We've got to act on a commercial basis and certainly what is right for the business and if we need to reprice we will reprice."
In June, CBA became the first bank to raise variable home loan interest rates since the latest economic downturn, increasing its standard rate by 10 basis points.
CBA's standard variable rate, at 5.74 per cent, is still the equal lowest among the big four banks, together with National Australia Bank.
ANZ and Westpac Banking Corporation's rates are at 5.81 per cent.
CBA's move attracted criticism from the Prime Minister and Treasurer, who said it would undermine government efforts to support the economy.
Earlier this month, ANZ chief Mike Smith said the country's banks would consider raising their rates if their funding costs rose, irrespective of whether the Reserve Bank of Australia had increased its base cash interest rate or not.
Economists currently expect the central bank to start lifting the three per cent cash rate by early 2010.
In 2008/09 CBA, which holds 29 per cent of Australia's mortgage market, increased its annual income from home loans by 32 per cent to $1.742 billion.
The bank benefited from what it termed a flight to quality, as people borrowed from what they considered a safe bank.
CBA's home loan lending volume increased by 20.3 per cent in the year to June, compared with the system growth of seven per cent.
But that growth appears likely to slow, based on Mr Norris's comments that the weakest part of the lending market was likely to be in the consumer parts of the portfolio.
"With increasing unemployment, we are going to see a lower growth rate," he said.
"We have also seen a de-leveraging taking place in the whole sector in general and that will have an impact."
CBA's net profit fell to $4.723 billion in the 12 months to June 30, from $4.791 billion in the previous year.
The bank's cash earnings, its preferred measure of profitability, fell seven per cent to $4.415 billion, as bad and doubtful debts almost tripled.