Commonwealth’s Share Price Drops after Revealing Further Refunds

Commonwealth Bank of Australia’s [ASX:CBA] share price sunk lower this morning, after revealing further plans to improve outcomes for its wealth management customers and address issues raised by the Royal Commission.

At time of writing, the bank’s shares are trading at $69.04, down 16.48% from its 52-week high.

Why did CBA’s share price drop?

This morning the bank announced its plans to pay back any ‘unauthorised advice fees’ that it charged to deceased customers over the past seven years.

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The bank will be reviewing any advice fees charged to deceased estates across all of its advice licensees. Any instances where unauthorised fees have been charged will be refunded with interest.

Currently 142,000 accounts have been assessed, of those accounts 12 deceased estates had been charged unauthorised advice fees between April and June 2018.

CBA Wealth Management Chief Operating Officer Michael Venter said:

The changes announced today continue the process of reform underway in our wealth management businesses and form part of our response to specific issues identified this year through the Royal Commission.

Charging unauthorised advice fees to deceased estates is unacceptable.

Regards,

Matt Hibbard,
For Markets & Money

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While many investors chase quick fire gains, Matt takes a different view. He is focused on two very clear goals. First: How to generate reliable and consistent income in a low-interest rate world. And second, how you can invest today to build wealth over the next 10–15 years. Matt researches income investments. You can find more of Matt’s work over at Total Income, where he is hunting down the next generation of dividend-paying companies for the future. He is also the editor of Options Trader, where he uses basic options strategies to generate additional streams of income beyond the regular dividend payments. Having worked for himself and with global firms for almost three decades, Matt has traded nearly every asset in existence. But now he is on a very different mission — to help investors generate income irrespective of what the market is doing. It’s about getting companies to pay you a steady, stable income, with minimal stress and the least risk possible. Matt doesn’t believe you have the luxury of being a bull or a bear in the market right now. You have to earn an income from it, regardless of whether stocks are going up or down. By getting the financial markets to pay you an income, you can get to focus on more important things than just money.


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