APRA launches Westpac investigation
The Australian Prudential Regulation Authority (APRA) has announced the launch of Westpac investigation and imposed an immediate increase in Westpac’s capital requirements of $500 million due to the heightened operational risk profile of the bank.
APRA said it would focus on examining the conduct that led to the matters alleged last month by AUSTRAC and on whether Westpac’s directors and/or its senior managers had breached the Banking Act, including the Banking Executive Accountability Regime (BEAR), or contravened APRA’s prudential standards.
Additionally, APRA would commence a review program focused on the bank’s risk governance, which would include analysis of its risk management, accountability, remuneration and culture.
“While Westpac is financially sound, there are potentially substantial gaps in risk governance that need to be closed,” APRA deputy chair, John Lonsdale, said.
“Given the nature of the matters raised by AUSTRAC, the number of alleged breaches and the period of time over which they occurred, this will necessarily be an extensive and potentially lengthy investigation.”
APRA announced it would conduct its investigation simultaneously with an investigation by the Australian Securities and Investments Commission (ASIC), as well as AUSTRAC’s legal proceedings, with each agency cooperating where appropriate.
Westpac said in the announcement made to the Australian Stock Exchange (ASX) it had acknowledged the APRA announcement in response to AUSTRAC’s statement of claim and would remain committed with APRA in all aspects of its investigation and review.
“Westpac accepts the gravity of the issues presented by AUSTRAC,” Westpac group’s chair, Lindsay Maxsted, said.
“As previously stated, these shortcomings are unacceptable and we are determined to urgently fix these issues an lift our standards.
“We will provide our full support to APRA through its investigation and review.”
AUTHOR
Oksana Patron
Recommended for you
Following an extraordinary general meeting today, Dixon Advisory parent company E&P Financial Group’s shareholders have voted on its proposed delisting from the ASX.
While overall financial adviser numbers have dipped below 15,500 this week, Rhombus Advisory is experiencing growth and approaching 500 advisers in its ranks.
Iress’ Xplan continues to dominate the financial planning software market with a multitude of uses, according to Netwealth research, despite newer players battling for a piece of the pie.
ASIC has shared the percentage of breach reports related to financial advice in FY24, noting increased reporting by smaller AFSLs.
