CBA spins off wealth management and mortgage broking units as inquiry unravels empire

The units will be demerged into a new company called CFS Group.

Reuters reports that Commonwealth Bank of Australia is stepping up its restructuring efforts as it demerges its wealth management and mortgage broking units into a new company called CFS Group. 

“Today’s announcement ... responds to continuing shifts in the external environment and community expectations, and addresses the concerns regarding banks owning wealth management businesses,” Chief Executive Matt Comyn said in a statement.

Also read: CBA sells stake in Chinese insurer amidst Asian exodus

The move comes as a powerful inquiry which uncovered widespread misconduct in the country’s financial services sector is continuing to unravel the large network CBA and the other three players in Australia’s banking scene have spent years building.

Also read: Bank satisfaction deep dives in Australia after damning probe

Earlier this month, CBA admitted it had violated money laundering and terror financing laws on 53,750 occasions and agreed to pay a record penalty of $519m (A$700m).

Here’s more from Reuters: