Powered by MOMENTUM MEDIA
subscribe to our newsletter

Westpac to wear additional $341m in remediation

 A big four bank has announced that its cash earnings will be hit by a further $341 million in remediation costs.

Westpac Group has announced that its cash earnings in the second half of the 2019 financial year (2H19) will be reduced by an estimated $341 million as a result of its customer remediation programs.

Of the $341 million impact on cash earnings, approximately 72 per cent relates to customer payments (including interest), while the remaining sum relates to costs associated with running these remediation programs.

Of the total cash earnings impact:

  • provisions associated with financial advice total $168 million; and
  • provisions associated with interest-only loans that did not automatically switch, when required, to principal and interest loans total $109 million.

Following the announcement, Westpac CEO Brian Hartzer said: “A key priority in 2019 has been to deal with outstanding remediation issues and refund customers as quickly as possible. The additional provisions announced are part of that commitment.

Advertisement
Advertisement

“As part of our ‘get it right, put it right’ initiative, we are determined to fix these issues and stop these errors occurring. We will continue to review our products and services to ensure they deliver the right outcomes for customers, and if necessary, make further provisions.”

Both ANZ and NAB have also announced that their FY19 earnings will be impacted by new remediation expenses.

Westpac is scheduled to release its FY19 results on Monday, 4 November.

 [Related: NAB flags $559m in new remediation costs]

Westpac to wear additional $341m in remediation

PROMOTED CONTENT


>Westpac Group has announced that its cash earnings in the second half of the 2019 financial year (2H19) will be reduced by an estimated $341 million as a result of its customer remediation programs.

Of the $341 million impact on cash earnings, approximately 72 per cent relates to customer payments (including interest), while the remaining sum relates to costs associated with running these remediation programs.

Of the total cash earnings impact:

  • provisions associated with financial advice total $168 million; and
  • provisions associated with interest-only loans that did not automatically switch, when required, to principal and interest loans total $109 million.

Following the announcement, Westpac CEO Brian Hartzer said: “A key priority in 2019 has been to deal with outstanding remediation issues and refund customers as quickly as possible. The additional provisions announced are part of that commitment.

“As part of our ‘get it right, put it right’ initiative, we are determined to fix these issues and stop these errors occurring. We will continue to review our products and services to ensure they deliver the right outcomes for customers, and if necessary, make further provisions.”

Both ANZ and NAB have also announced that their FY19 earnings will be impacted by new remediation expenses.

Westpac is scheduled to release its FY19 results on Monday, 4 November.

 [Related: NAB flags $559m in new remediation costs]

Westpac to wear additional $341m in remediation
mortgagebusiness

If you’re feeling overworked and overwhelmed in this fast-paced mortgage market, it’s time to make some changes, and the Business Accelerator Program can help! Early bird tickets are on sale now. Work smarter, not harder, this year.

Charbel Kadib

Charbel Kadib is the news editor on the mortgages titles at Momentum Media.

Before joining the team in 2017, Charbel completed internships with public relations agency Fifty Acres, and the Department of Communications and the Arts.

You can email Charbel on: This email address is being protected from spambots. You need JavaScript enabled to view it.

Latest News

Increased property price caps for those purchasing homes using the First Home Loan Deposit Scheme and the Family Home Guarantee from 1 July ...

Despite a tumultuous 12 months for the Australian property market, CoreLogic has reported that house or unit median values ticked over the m...

CBA has sold its Australian general insurance business to South African insurer Hollard Group and entered a 15-year distribution deal. ...

How long do you think it should take to discharge a mortgage?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.