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RETAIL BANKING | Staff Reporter, Australia

CBA sells stake in Chinese insurer amidst Asian exodus

It will sell 37.5% equity interest in BoComm Life to Mitsui Sumitomo Insurance.

Commonwealth Bank has announced the sale of 37.5% equity interest in BoComm Life Insurance Company Limited to Mitsui Sumitomo Insurance for $501.2m (RMB3.2b), in yet another move that marks the exodus of Australian banks from the region.

Also read: NAB joins Australian exit from wealth management business

The transaction is expected to result in an indicative after tax gain on sale of approximately $339.68m (AU$450m). The carrying value of Commonwealth Bank’s equity interest in BoComm Life was $113.23m (AU$150m) as of last year. 

Also read: Can trade finance plug the gap left by Australian banks' retreat from wealth?

“This transaction represents a further step in simplifying and focusing our portfolio and follows the announcement of the proposed sale of the Group’s life insurance businesses in Australia and New Zealand to AIA Group, and the strategic review of the Group’s life insurance business in Indonesia,” said CBA CEO Matt Comyn.

The move by CBA follows the stake sale of fellow Australian lender ANZ who earlier sold its 55% stake in Cambodian JV ANZ Royal Bank, as the country’s major banking players move to simplify their portfolios and focus on markets closer to home.

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