Aussie interest keeps CBA options open
Trade sales may remain an option at Commonwealth Bank for some of the businesses that were being prepped for a demerger - a plan shelved by the bank yesterday.Aussie Home Loans is one subsidiary generating interest amid much debate within the mortgage origination sector over business models and commission structures.Banking Day has been told both John Symond, the founder and former CEO of Aussie, and - separately - James Symond, the current CEO (and nephew of John) have engaged in talks with their employer, CBA, over a buyout of the business.A third entity may also have engaged in talks recently as last week. The bank called these talks in preparation for yesterday's announcement on its new strategic thinking.CBA said it "suspended preparations for the demerger [of broking and wealth] in order to support the focus [on] refunding customers and remediating past issues" catalogued by ASIC, APRA and the banking royal commission last year.CBA said it is now "prioritising the implementation of these recommendations," of the Hayne royal commission.In June last year - around the mid-point of Hayne's hearings into industry misconduct - CBA's new chief executive Matt Comyn unveiled a blueprint to divorce the wealth management arms of the group from its core banking businesses.The bank at the time intended to bundle CBA's mortgage broking businesses (of which Aussie is the primary component) into a holding company alongside Colonial First State.John Symond, who disrupted the mortgage distribution model with a populist approach in the early 1990s, began selling down his stake to the bank at the high point of the GFC.Commonwealth Bank paid A$71 million to buy a one-third stake in Aussie Home Loans in late 2008. In late 2012 the bank lifted this to 80 per cent. Symond exercised a put option on the remaining stake.The bank's 2018 annual report put revenue, combined for Aussie and another broker eChoice, at $237 million of income, while expenses were $197 million.This report lists "the Aussie brand name [as valued at] $16 million)," and described it has having "an indefinite useful life."