Commbank to maintain Wealth Management strategy
There will be no significant change in strategy on the part of the Wealth Management division of the Commonwealth Bank in the wake of the controversy which has surrounded Commonwealth Financial Planning.
The Commonwealth Bank's Wealth Management group executive general manager, Annabel Spring used an analysis of her division's annual results to make clear to Money Management that while there had been challenges this did not justify a significant change in strategy.
"I don't expect to see a significant change in strategy on the part of wealth or the bank as a whole," she said. "The significant thrusts of the strategy remain really solid. We've got an absolute commitment to doing the right thing by our customers."
Spring made clear that while the Wealth Division had faced a number of challenges flowing from the 2011 enforceable undertaking entered into with the Australian Securities and Investments Commission (ASIC) and the consequent Senate inquiry and imposition of licensing conditions, this was not a reflection on its underlying strategy.
However she said the strong cultural message now being delivered to personnel within the division was that the interests of the customer needed to be placed uppermost.
Spring acknowledged that the Wealth Division's results had been made to look good by the exit of Colonial First State Global Asset Manage exiting its property business.
However she said that, with or without the sale of the property business, it had represented an excellent result for the division.
"Divesting ourselves of property was a very good thing to do for the bank and Wealth Management," Spring said.
Referencing the performance of CommInsure, Spring said there was no question that the business had benefited from its repricing strategy, particularly with respect to group insurance.
She said that the repricing had been accompanied by sensible discussions with superannuation trustees around terms and conditions and this had proved to be healthy for both the industry and for trustees.
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