The Commonwealth Bank of Australia (CBA) has almost doubled remediation coverage to CountPlus for past misconduct when it owned Count Financial.
In an announcement to the ASX on Thursday morning, CBA said it has increased the limit of the indemnity provided to CountPlus from $300 to $520 million to cover certain remediation activities that were identified at the time of sale and up to four years post sale.
“The estimate of ongoing service fee customer remediation payments have been revised to reflect actual case assessments performed and remediation payments made, which has been recognised as a post-tax adjustment of $147 million to the Count divestment in 1H23,” the bank said.
After Count Financial was sold to CountPlus, CBA agreed to provide indemnity to cover remediation.
Count Financial was sold by CBA to CountPlus in 2019 for $2.5 million – a fraction of the $373 million the major bank acquired it for in 2011.
CountPlus was founded in 2007 by Barry Lambert who also started Count Financial. He stayed on as chair of CountPlus until 2017.
“CBA is committed to comprehensively addressing the full range of remediation issues impacting customers of aligned advice businesses including Count Financial, which was sold to CountPlus on 1 October 2019,” the bank said.
In a separate release, CountPlus said the potential for further increases to the indemnity limit remains under certain defined remediation triggers and is not limited to fees for no service.
After Matthew Rowe stepped down as leader of the company earlier this year, former CBA executive Hugh Humphrey took over.