The wealth management arm of Commonwealth Bank of Australia (CBA) reported a cash net profit after tax of A$413m ($277.1m) for the year ended 30 June 2019.
This is a 42% slump from the last year figure of A$707m.
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Excluding discontinued operations, the division’s cash net profit after tax slipped 37% to A$160m from A$255m.
Operating expenses at the unit surged 32% to A$645m from A$490m. This was said to be due to higher compliance costs and technology investments.
Average funds under administration of A$149bn were 5% higher than last year.
CBA business and private banking segment’s cash net profit after tax dropped 7% to A$2.66bn from A$2.84bn.
Net interest income at the unit remained almost stable at A$5.12bn.
The unit’s operating expenses increased 8% to A$2.41bn from A$2.23bn.
Overall, the banking group posted cash net profit after tax from continuing operations of A$8.49bn for the year ended 30 June 2019, down 5% from A$8.91bn in the previous year.
Statutory net profit after tax from continuing operations at the group dipped 8% to A$8.36bn from A$9.06bn.
Cash and statutory net profit after tax including discontinued operations both dropped 8% year-on-year to A$8.7bn and A$8.57bn, respectively.
Closure of Financial Wisdom
CBA announced plans to shutter Financial Wisdom. The move marks the bank’s withdrawal from its aligned advice businesses.
The bank will also allow CFP-Pathways advisers to move to some other licensee or make self-licensing arrangements.
The decision comes shortly after CBA’s sale of its global asset management arm to Mitsubishi UFJ Trust and Banking.
CBA recently also announced the divestiture of its advice arm Count Financial to CountPlus.
