Westpac in Two Spots of Bother
Investors shrugged off two bits of poor news for the country’s second biggest bank on Friday, one involving a possible $200m fraud and the other an $87m penalty for dodgy advice.
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Westpac Gives Car Finance Arm the Flick
Last week it kept its New Zealand banking business, on Monday Westpac revealed it was selling its Australian car finance businesses to non-bank financial group Angle Finance.
Read MoreWBC – Citi rates the stock as Buy
Buy rating and target price of $29.50 are both retained.
Read MoreWestpac Changes Mind on NZ Exit
Westpac has done an about-face and is to retain ownership of its NZ banking operations, believing a demerger of the WNZL business would not be in the best interests of shareholders.
Read MoreWestpac Back in the Naughty Corner Again
Two days after a solid interim result, a dividend and encouraging noises about cost cuts between now and 2024, Westpac is back in trouble with regulators.
Read MoreWestpac Hits 16-Month High on Strong Result
Westpac shares hit their highest level in 16 months on Monday thanks to a big tick of approval from investors for a better-than-expected interim result and dividend payout.
Read MoreWestpac Kicks off Bank Week with Strong Result
Westpac is paying an interim dividend of 58 cents a share after revealing a solid rebound in earnings for the six months to March 31 from the depressed 2019-20 year.
Read MoreWestpac Decides to Clean House
Westpac’s interim profit next week will take a $582 million hit from provisions, write-downs and a range of other “notable items”, the bank told the ASX in a Monday announcement.
Read MoreWestpac Set to Ditch the Ditch?
Westpac is reportedly looking at quitting New Zealand and retreating to its Australian core, telling the ASX yesterday afternoon that it had appointed Macquarie to explore the sale of the NZ business.
Read MoreWestpac Takes Hit on Mortgage Insurance Arm
Westpac is selling its Lenders Mortgage Insurance Limited (WLMI) to Arch Capital Group for a loss, while entering into a 10-year agreement for Arch to provide Lenders Mortgage Insurance to the Group.
Read MoreSolid Recovery for Westpac, Better Days Ahead
Westpac has joined rivals the Commonwealth and National Australia Bank (as well as the regional Bendigo and Adelaide) in reporting a solid recovery in earnings, thanks to the improving economic outlook.
Read MoreWBC – Morgans rates the stock as Add
Morgans expects the upcoming result for the Commonwealth Bank ((CBA)) to likely increase upside risk to earnings and dividend forecasts for FY21. The Hold rating is maintained and the target price is increased to $25.50 from $23.50.
Read MoreAPRA Paves Runway To Higher Bank Dividends
In more good news for investors, APRA has eased its dividend guidance for the banks and, from the start of 2021, will no longer be holding lenders to a minimum level of earnings retention.
Read MoreANZ, NAB Face Up To AGMs After Westpac Dangles Dividend Carrot
ANZ Bank and National Bank hold their annual meetings this week and should have an easier ride than Westpac did on Friday. Westpac pledged at the meeting that shareholders will see a return to normal dividend payments in 2021 following a tumultuous year that has swiped the bank’s profits by 66%.
Read MoreInvestors Shake Off Westpac Woes As APRA Issues EU
Investors have again ignored the step-up in regulatory action against Westpac by the key overseer, APRA. Fresh from criticising the bank (the country’s second-largest) immature culture and poor oversight on responsibilities in risk management and assessment earlier in the week, Westpac shares dipped by just 0.5% to $20.20 yesterday after APRA revealed it had forced the bank to agree to a court-enforceable undertaking (or CEU) to lift its game.
Read MoreWestpac Divests Insurance Arm To Allianz
Westpac will sell two general insurance businesses to German insurance giant, Allianz for $725 million. The sale includes a 20-year agreement for the distribution of insurance products to Westpac’s customers and will bolster the bank’s capital position by around 12 points.
Read MoreAPRA Takes Aim At “Immature And Reactive” Westpac
More trouble with regulators for Westpac with the main financial overseer, APRA, now taking aim at the bank. The outcome could see Westpac having the existing penalty capital overlay of $1 billion boosted as a result of APRA finding breaches by Westpac of some key financial measures.
Read MoreAPRA Flags End To Clamp On Bank Dividends
Old favourites, bank shares returned to the fore on the ASX yesterday after the key regulator APRA revealed that its clamp-on dividends would be eased.
Read MoreBank Reporting Evokes Mixed Reaction From Analysts
As expected the COVID-19 pandemic, lockdowns, and the surge in unemployment and business problems whacked every measure at Australia’s big four banks in the year to September 30.
Read MoreInvestors Markdown Westpac After “Disappointing” Result
Westpac’s new long-term CEO, Peter King yesterday described the bank’s full results as “disappointing”, but the reality is the bank has no one else to blame but itself.
Read MoreWestpac Cuts Dividend As Full Year Profit Falls 62%
Westpac has joined rival ANZ in deciding to pay a reduced final dividend after reporting a sharp slide in full-year earnings.
Read MoreWBC – Credit Suisse rates the stock as Outperform
The bank has announced second half cash earnings will be affected by $1.22bn in “notable items”. Credit Suisse believes this will clean up a range of items around specialist buisness which should mean “cleaner” results going forward.
Read MoreWestpac Joins NAB In Warning On Earnings Blow
Westpac has joined the National Australia Bank in revealing pre-result, one-off losses, and other costs of more than a billion dollars. In the case of the NAB, it was more than $600 million for the second half to September 30 while Westpac has revealed a bill of $1.2 billion.
Read MoreWestpac Tie-Up Pushes Afterpay Shares To New All-Time High
Shares in buy now pay later group, Afterpay hit an all-time high of $105.80 yesterday after it announced a new partnership with Westpac. The deal will see Westpac granting Afterpay customers a savings account that can be used as an ordinary savings account but will also be mined for behavioural data.
Read MoreRBA Issues Banks Clean Bill Of Health Despite “Elevated Risks”
Buried in the Reserve Bank’s latest Financial Stability Review is the best news the country (and the governments) have had since the COVID-19 pandemic started ravaging the economy in February – Australia’s banks are healthy and have more than enough capital to support the economy during the slowdown without getting into trouble.
Read MoreWBC – UBS rates the stock as Buy
Westpac Banking Corp reached an agreement to settle the civil proceedings against it with the Australian Transaction Reports and Analysis Centre (AUSTRAC). This includes a penalty of -$1.3bn and brings to an end a disappointing chapter for the bank, observes UBS.
Read MoreWestpac Shares Unmoved Despite Record-Breaking Fine
As reported yesterday Westpac has confirmed a massive $1.3 billion in penalties relating to more than 23 million breaches of anti-money laundering rules.
Read MoreWestpac Readies Settlement With AUSTRAC Over AML Breaches
A massive fine and other penalties are reportedly due to be levied again Westpac shortly in connection with its millions of breaches of money laundering laws.
Read MoreWBC – Morgans rates the stock as Add
The third-quarter net interest margin (NIM) of 2.05% is softer than the broker had expected. The analyst notes the key drags on the margin in the quarter were a strong build-up of liquid asset balances, lower cash rate and higher term deposits.
Read MoreWestpac Opts To Drop Dividend Amid Virus Uncertainty
Westpac has joined its smaller rival in Bendigo and Adelaide in dropping dividend for the 2019-20 financial year. After Westpac suspended its interim dividend in May, the board decided it is prudent not to pay a first-half dividend at all, as the bank faces a highly uncertain outlook due to the coronavirus pandemic.
Read MoreHas APRA Clarified The Outlook For Banks?
The dividend outlook for banks has weighed heavily on valuations since the onset of the pandemic and the resultant economic slump. Has the prudential regulator, APRA, set minds at rest?
Read MoreAPRA “Strikes A Balance” On Bank Dividends
APRA has eased restrictions around paying dividends in time for the June 30 and September 30 reporting season but told the banks and insurers they should seek “to retain at least half their earnings” when considering payouts.
Read MoreWestpac Uncovers More Austrac Money Laundering Breaches
Already on the hook for more than 23 million transactions, Westpac says it has found an extra half-million or more suspicious transactions that may have breached AUSTRAC money laundering rules.
Read More“Flexibility”: APRA Opens Door On Bank Dividends
The chances of banks resuming paying dividends have risen sharply after the key regulator, the Australian Prudential Regulation Authority (APRA) indicated a change of mind.
Read MoreMoody’s Finds Silver Lining In Shutdown For Local Banks
Global ratings group has found a silver lining in the recession and lockdowns generated by the COVID-19 pandemic – it has made the Australian financial system and the banks, safer.
Read MoreA Look At Dividends In The Current Market Environment
As the outlook for earnings has significantly deteriorated and companies conservatively manage balance sheets, the outlook for dividends has been materially impacted. Since the middle of February, over 30% of companies in the ASX200 have deferred, cancelled, suspended, or revised dividends.
Read MoreWBC – UBS rates the stock as Neutral
Westpac has announced the formation of a specialist business division, which includes wealth, superannuation, investments & automotive, general & life insurance. The bank is taking a strategic review to assess the most appropriate ownership structure.
Read MoreWBC – UBS rates the stock as Neutral
Westpac has announced the formation of a specialist business division, which includes wealth, superannuation, investments & automotive, general & life insurance. The bank is taking a strategic review to assess the most appropriate ownership structure.
Read MoreWBC – Credit Suisse rates the stock as Outperform
Credit Suisse downgrades estimates by -1-5% following the first half result, to incorporate lower revenue and higher expenses. The broker observes greater confidence around Westpac’s provisioning compared with its peer group.
Read MoreBanks Well Placed To Weather The COVID Storm
Both KPMG and Deloitte have examined the interim reports from the big four and see them better placed for the immediate future than it might seem from the results which all saw a surge in bad debt provisioning, loan impairments and provisions for compensation.
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