Advice remediation still dragging on Westpac

westpac/remediation/ASX/advice-remediation/financial-advice/

23 October 2019
| By Mike |
image
image
expand image

Westpac may have substantially exited financial advice but it has announced an increase in its provisioning for advice remediation.

The big banking group told the Australian Securities Exchange (ASX) today that its second half earnings would be recued by an estimated $341 million due to customer remediation programs, totalling $958 million in customer remediation for FY19.

It said the aggregate customer remediation programs and costs related to the previously announced wealth reset would reduce earnings by $377 million in the second half.

The ASX announcement said that of the $341 million impact on cash earnings, 72% related to customer payments (including interest) while the rest related to costs associated with running the remediation programs.

It said the majority of new provisions related to ongoing advice service fees and changes in how the time value of money was calculated including extending the forecast timing over which payments were likely to be made.

“The current estimated provision associated with authorised representatives now represents 32% of the ongoing advice fees collected over the period,” the announcement said. “For salaried planners the estimated per centage is 26%.”

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

So we are now underwriting criminal scams?...

2 months ago

Glad to see the back of you Steve. You made financial more expensive, not more affordable as you claim, and presided ...

2 months ago

Completely agree Peter. The definition of 'significant change is circumstances relevant to the scope of the advice' is s...

4 months 1 week ago

A Sydney financial adviser has been permanently banned from providing any financial services, with the regulator deriding his “lack of integrity, trustworthiness and prof...

3 weeks 1 day ago

Minister for Financial Services, Stephen Jones, has provided further information about the second tranche of the Delivering Better Financial Outcomes (DBFO) reforms....

2 weeks ago

One licensee has lost 27 advisers in the past week, now sitting at zero, according to the latest Wealth Data figures....

3 weeks 1 day ago

TOP PERFORMING FUNDS