CBA forgives some Storm loans
Some clients of Storm Financial may be relieved of their obligation to repay part of their loans funded by Commonwealth Bank, the Financial Review reported.
Commonwealth is offering some clients of Storm Financial the opportunity to "freeze loans and allow borrowers to stay in their homes for the rest of their lives with no additional interest or charges" the newspaper reported. The bank would enforce repayment of the loan once the borrower died.
Storm Financial, a Townsville-based financial planning firm, failed in mid January. The firm steered many of its clients into highly leveraged equity investment strategies and encouraged clients to borrow against their homes to part fund the investments, and then a second level of margin loan debt on top of that.
Storm had around $1 billion in margin loans funded through CBA's Colonial arm, while the bank also provided home loans to some customers.