Commonwealth Bank of Australia sells stake in Bank of Hangzhou

SYDNEY: The Commonwealth Bank of Australia (CBA) has announced it has signed a binding sale agreement to divest its remaining 5.45% shareholding in Bank of Hangzhou Co., Ltd (HZB) to New China Life Insurance Co., Ltd (NCI). NCI is a Beijing-headquartered life insurance company with listings on both the Shanghai and Hong Kong stock exchanges. The transaction is expected to yield approximately $940 million in gross proceeds for CBA.

CBA Chief Executive Officer Matt Comyn commented on the sale: “CBA has been a longstanding shareholder of HZB since its original investment in 2005, and we are pleased to have contributed to the development of HZB into a significant player in retail, wealth management, and commercial banking across the Yangtze Delta region.”

The transaction is projected to enhance the Group’s CET1 ratio by approximately 18 basis points on an Australian Prudential Regulation Authority basis, based on the Group’s risk-weighted assets as of September 30, 2024.

Completion of the transaction is contingent upon several regulatory approvals, including from the National Financial Regulatory Administration, the Shanghai Stock Exchange, and the Shanghai Branch of China Securities Depository and Clearing Corporation Limited. Subject to these approvals, the transaction is expected to be finalized by mid-2025.

Bank of Hangzhou, established in September 1996 and based in Hangzhou, Zhejiang province, is listed on the Shanghai Stock Exchange.