The COVID-19 crisis has hammered yet another company. This time, Commonwealth Bank of Australia said it had to book about $970 million in provisions to cover expected losses in the third quarter.

To generate some cash, it sold a majority stake in its wealth management division to KKR (NYSE: KKR).

KKR, COVID-19 Crisis, and Commonwealth Bank of Australia

The Australian economy is facing many of the same challenges we’re seeing here in North America. Australia’s banks are facing their first recession in a decade while addressing low rates and high unemployment. The Commonwealth Bank of Australia had total provisions of A$6.4 billion.

The firm sold 55% of its wealth arm Colonial First State for A$1.7 billion. The deal helps increase the firm’s core capital ratio to 0.4%.

The transaction implies a total valuation for CFS on a 100% basis of $3.3 billion. Meanwhile, the sale price represents a multiple of 15.5x CFS’s pro forma net profit after tax of approximately $200 million.

“We are confident that together with KKR, we can provide CFS with an increased capacity to invest in product innovation, new services, and its digital capabilities,” said CBA CEO Matt Comyn. “We have a shared vision for CFS to be one of the leading superannuation and investment businesses in Australia, offering members greater choice and better value.”

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