Commonwealth Bank of Australia said it would sell its 80 percent stake in Indonesian life insurance business PT Commonwealth Life to Hong Kong billionaire Richard Li’s FWD Group for A$426 million ($301.57 million).
“The transaction aligns with CBA’s strategy to focus on its core banking businesses and to create a simpler and better bank,” the bank said in a statement.
Most big Australian banks, which are under intense scrutiny from a quasi-judicial investigation of the Australian financial sector, have been streamlining their operations to focus on their core competency: lending.
As a part of the deal, CBA said, its Indonesian banking business PT Bank Commonwealth would enter a 15-year life insurance distribution partnership with FWD.
CBA also said it expected to record a post-tax gain on the sale of about A$140 million and an increase of 7 basis points to its Common Equity Tier 1 ratio as of the end of June.
Reuters reported in September that at least five insurers, including Britain’s Prudential and Canada’s Sun Life , had bid for CBA’s majority stake in the Indonesian insurance unit.