Commonwealth Bank of Australia (CBA) has agreed to sell its 37.5% stake in Chinese life insurer BoComm Life to Japan’s Mitsui Sumitomo for AU$668 million (around SG$676 million).

The sale, which is a necessary step in completing the AU$3.8 billion sale of CBA’s life insurance businesses in Australia and New Zealand to Hong Kong’s AIA Group, will earn the bank an after-tax gain of about $450 million.

The deal is part of a divestment program that began under former chief executive Ian Narev and has continued under his successor, Matt Comyn, in a bid to simplify and focus CBA’s portfolio, Reuters and Australian Associated Press reported.

The proceeds from the sale, subject to regulatory clearance in China, will be used by the bank to raise its common equity tier 1 ratio by 0.13 percentage points.

CBA is also expected to offload its global asset management business by the end of this year, AAP said.

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