The Commonwealth Bank of Australia (ASX: CBA) share price is trading lower again on Friday.
In morning trade the banking giant's shares are down over 1% to $77.80.
This appears to be due to the impact that the Australia and New Zealand Banking Group (ASX: ANZ) result has had on investor sentiment in the banking sector. Particularly, in respect to dividends after ANZ elected to frank its final dividend by only 70%.
ANZ made the decision to cut its franking because of the shape of its business following a series of divestments. I suspect investors appear concerned that the other banks may follow suit and reduce their franking accordingly.
As a result, news that CBA is making progress with one of its divestments may not have helped its shares today.
What did CBA announce?
This morning CBA advised that it has implemented a joint cooperation agreement with AIA Australia in relation to its CommInsure Life business.
According to the release, CBA has received an upfront payment from AIA Australia of $500 million. In light of this, the full economic interests associated with CommInsure Life (excluding its 37.5% equity interest in BoCommLife Insurance) have been transferred to AIA.
The 25-year Australian distribution agreement between CBA and AIA has also commenced, effective today.
CBA's Chief Executive Officer, Matt Comyn, said: "We are excited by the opportunity to bring together the strengths of AIA and CommInsure Life and are working hard with our partner to develop a new generation of products for CBA's customers, which will deliver excellent customer outcomes."
The bank believes the commencement of the joint co-operation agreement represents an important first step in the revised transaction path for the planned divestment of CommInsure Life. The steps towards an ultimate completion of the share sale or statutory asset transfer continue to progress in line with its previous announcements.
