CBA sniffs around Suncorp
The Commonwealth Bank of Australia (CBA) is currently the only institution publicly sharing its interest in the wealth management arm of Suncorp.
CBA has admitted that it has conducted “high level, exploratory discussions” with Suncorp, but it seems that any more acquisitions could put pressure on CBA’s credit position.
Standard & Poor’s credit analyst Mark Legge said that as a result of the funding and integration requirements resulting from CBA’s purchase of BankWest, there is now “reduced tolerance” on CBA’s ‘AA’ rating level “for any risks that may emerge due to additional acquisitions or significant weakening in investor sentiment in the short term”.
In regards to the BankWest acquisition, Legge said that while CBA’s funding diversity and flexibility should mean the additional funding requirements of the purchase should be “manageable”, additional funding remains a risk in the current environment.
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