The Commonwealth Bank has withdrawn from discussions with the Royal Bank of Scotland to acquire ABN Amro Australian Holdings.

The bank has said that it has made this decision after its board assessed the current economic climate, the uncertainty in world financial markets and the risks involved in integrating these complex businesses at this time. The bank believes that given these factors it would not be in the best interests of shareholders to proceed with the acquisition.

The bank said that it will continue to fully focus its efforts in the institutional banking and markets area on further organic growth and on being a leading provider of a full range of innovative and competitive financial solutions for its institutional and corporate customers.