CBA to offload its Indonesian arm to Singapore's OCBC

The news: The Commonwealth Bank will sell its 99% holding in Indonesian subsidiary PTBank Commonwealth for roughly $220 million to OCBC Indonesia, part of Singapore-listed multinational OCBC.

The numbers: If the deal passes regulatory hurdles it should be completed in in the second or third quarter of 2024, CBA said. PTBC had more than 1.2 million customers, total assets of $1.8 billion and net assets of $390 million as of 30 June 2023. OCBC Indonesia is the country's 9th largest bank by assets, while parent OCBC is the second largest in Southeast Asia.

The context: CBA is exiting the Indonesian market to focus on its Australian and New Zealand businesses, the bank said, echoing similar exits and exit attempts by big four counterparts in recent years. In October, Westpac gave up on plans to divest its Papua New Guinea and Fiji businesses after a proposed takeover was knocked back by competition regulators. Meanwhile, OCBC, with its strong presence in Singapore, Indonesia, Malaysia, and Greater China, is growing its presence in the region to capitalise on emerging growth prospects, Bloomberg reports.