Australia's CBA suspends wealth management and mortgage broking demerger
(Adds context on bank and its recent divestitures)
March 14 (Reuters) - Commonwealth Bank of Australia
said on Thursday it had suspended preparations for the demerger
of its wealth management and mortgage broking businesses in
order to focus on implementing the recommendations of the Royal
However, the bank reiterated that it was still committed to
"ultimately" exiting its wealth management and mortgage broking
The lender had last year unveiled plans to demerge the
entire wealth management and mortgage broking arms into a
separately listed new company through a share market float.
It had then sold its asset management arm to Japan's
Mitsubishi UFJ Financial Group in a surprise move. The
business was expected to be the crown jewel in CBA's intended
Last week, Australia's largest lender had said there was
still a lot of work to be done under its remedial plan to
address the 76 recommendations made by a powerful inquiry into
the financial sector, which had revealed widespread instances of
Wealth managers were subjected to much scrutiny after the
revelations of deceptive conduct, which included practices of
charging customers for services they did not provide. AMP Ltd,
the country's largest, had allegedly misled regulators
for almost a decade.
CBA's first-half profit had also disappointed due to higher
costs and increased scrutiny towards the bank.
(Reporting by Ambar Warrick in Bengaluru
Editing by Phil Berlowitz and Lisa Shumaker)
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