Westpac impairments surge
Westpac has announced a major rise in impairment charges to $800 million for the December quarter, attributing the experience to a $360 million increase in provisioning for three large corporate exposures, including $300 million to Babcock & Brown International.
In a company update released to the Australian Securities Exchange today, Westpac chief executive Gail Kelly said that pro forma group cash earnings on an unaudited basis for the December quarter were around $1.2 billion, down 2 per cent on the prior corresponding period.
Despite this, she said there had been strong growth in customer deposits for the period, which had risen by 9.6 per cent.
However, drilling down into the banking group’s wealth management area, Kelly said that BT Financial Group continued to be impacted by the volatility in asset markets, albeit that it had produced a sound result with respect to life insurance and wrap cash balances.
She said the group had maintained a leading position in net funds under administration flows.
Commenting on the outlook, Kelly said that with global economic conditions continuing to be volatile, operating conditions would remain difficult.
Commenting on the banking group’s merger with St George, Kelly said it was progressing to plan with no surprises in the portfolio.
AUTHOR
Mike Taylor
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