Confidence in Commonwealth Bank crashes
The Commonwealth Bank's alleged failure to notify the market promptly of an updated estimate of bad debt provisioning has destroyed fund manager confidence in the bank. Analysts say the Commonwealth Bank, which is now the subject of two regulator inquiries, may have broken the law by breaching disclosure requirements. The bank is blaming its broker Merrill Lynch for failing to tell institutional investors about the increase in bad debt provisioning from around 0.50 per cent of total loans outstanding to 0.60 per cent. Analysts now expect that figure to climb further. JP Morgan said questions about CBA's corporate credibility had been raised.
Source: The Australian Financial Review