Commonwealth Bank of Australia is planning to close down two troubled mortgage funds under its wealth management business, giving rise to speculation that a series of shutdowns is likely to happen over the next months, a report by The Age reveals.

The funds in question are the A$852 million (about $768 million) Colonial First State Mortgage Fund and the A$13 million Wholesale Guaranteed Mortgage Fund.

The funds are just two of the many that have been frozen under the Colonial First State brand following a liquidity squeeze in 2008. The company's latest decision is expected to affect the over 200,000 investors that have been locked out of mortgage funds at the height of the global financial crisis.

Chief executive officer Brian Bissaker was quoted to have said that the move is meant to protect clients' initial capital.

"The logical conclusion is to give investors their money back as soon as we can while the fund is a going concern," Mr Bissaker told the news service. He clarified, however, that a 100-cents to the dollar payment is not guaranteed, owing to the unpredictable mortgage market.

"It's our intention to pay back the capital," he reportedly said. "I can't say what will happen in two years' time as those mortgages mature - where we are today, the impact has been on the income, not the capital component."