Westpac takes 24% profit hit
Westpac has suffered a 24 per cent first-half profit slump to $3.173 billion, leading its chief executive, Brian Hartzer to describe it as a disappointing result reflecting weaker business conditions and other issues including remediation and the resetting of the bank’s wealth strategy.
Importantly, cash earnings excluding major remediation and restructuring items were down five per cent.
Despite the negativity, the company announced an unchanged fully franked dividend of 94 cents per share.
However, Hartzer said the past six months had been a turning point for the bank and that it was proactively addressing legacy issues while improving the products and services it delivered.
“We are exiting personal financial advice to focus on the parts of our wealth business where we have a competitive advantage and we are delivering significant cost savings by simplifying the business,” he said.
On the big-ticket item of customer remediation costs, the bank confirmed it had provisioned $1,445 million pre-tax over the past three years, including $1,249 million for customer refunds.
Recommended for you
A financial advice firm has been penalised $11 million in the Federal Court for providing ‘cookie cutter advice’ to its clients and breaching conflicted remuneration rules.
Insignia Financial has experienced total quarterly net outflows of $1.8 billion as a result of client rebalancing, while its multi-asset flows halved from the prior quarter.
Prime Financial is looking to shed its “sleeping giant” reputation with larger M&A transactions going forward, having agreed to acquire research firm Lincoln Indicators.
An affiliate of Pinnacle Investment Management has expanded its reach with a London office as the fund manager seeks to grow its overseas distribution into the UK and Europe.
