CANBERRA: Commonwealth Bank subsidiary Bankwest will shut its corporate banking services outside of its home state as it retreats to its core customers in Western Australia. Bankwest revealed on Wednesday it would be rolling “relationship managed” business clients based outside of WA into its parent company’s business and private banking division. The bank will still offer corporate banking in WA and will serve small business customers nationwide, Bankwest managing director Rowan Munchenberg said. He said the move would help Bankwest focus on its core clients: retail and small business customers and corporate banking in WA. Bankwest said staff in its east coast corporate banking division would move across to CBA’s BPB team or other positions where possible. It was too early to say if there would be job losses, a spokesman said.
“CBA’s growth plans and existing footprint, combined with excellent products and services means that it is well-positioned to support Bankwest non-WA based relationship-managed business customers and help them grow,” Mr Munchenberg said. Bankwest’s business lending arm has been problematic for CBA since it bought the Western Australian bank in 2008. A 2011 parliamentary heading heard CBA committed “fraud” by deliberately impairing more than 1000 commercial Bankwest loans, combined worth more than $8.2 billion, enabling it to foreclose the loans despite customers never missing payments and having adequate security. CBA denied any wrongdoing at the time.
Bankwest has made several changes to its loan products over the past two months, as regulators voiced concerns that the property investor market may be overheating. In January it announced it would no longer be accepting applications from new customers looking to refinance standalone investment loans from other banks, and it has since hiked rates on variable investor property home loans by 15 basis points. And last month Bankwest revealed it would no longer include negative gearing benefits when calculating loan eligibility for property investors. The move means investors will qualify for lower loan amounts. Mr Munchenberg said the two banks were working to ensure a smooth transition for customers moving from Bankwest to CBA. Bankwest customers and employees will start migrating to CBA during 2017.
