Aussie John hits $185m payday
The man who pledged to take on the big banks two decades ago, "Aussie" John Symond, has received a $185 million stake in the nation's biggest lender in exchange for his mortgage broking business.
Mr Symond last year agreed to sell down his ownership of Aussie Home Loans to Commonwealth Bank, with the bank's stake in Aussie swelling from a third to 80 per cent.
Until now, the deal's price tag has not been disclosed.
But on Friday Commonwealth Bank told investors it had issued nearly 2.75 million new shares in relation to a December 2012 deal with Mr Symond and his company, Dawnraptor Pty Ltd.
It is understood the deal being referred to is the sale of Aussie to CBA, and Mr Symond was paid mainly in stock. At current prices, the shares issued to Mr Symond are worth about $185 million.
CBA has declined to reveal exactly what it paid Mr Symond to take a bigger stake in Aussie.
Mr Symond played a central role in the outbreak of mortgage competition in the 1990s, using the catchcry "we'll save you" to encourage customers to shop around for a better deal on their mortgage.
He has maintained that Aussie will keep its independence despite being majority owned by Commonwealth Bank, and the broker continues to offer loans from a range of banks.
However, consumer groups have questioned the deal and the Australian Competition and Consumer Commission has conceded it could slightly lessen competition.
When he approved the deal in March, ACCC chairman Rod Sims said the commission had assumed CBA would increase the number of "white-label" Aussie-branded loan products sold through Aussie's network of 750 brokers.
"Aussie's not going to cut its own throat by not selling other products, but it would be naive to think the Commonwealth does not have influence," Mr Sims said.
Nevertheless, Mr Sims said the deal did not meet the ACCC's threshold of a substantial lessening.
Under the deal between Mr Symond and CommBank, the bank has the right to move to 100 per cent ownership in the future.