Powered by MOMENTUM MEDIA
realestatebusiness logo

Subscribe to our newsletter

Westpac restructures exec team

The big four bank will slash its head office roles by around 20 per cent, after an initial restructure of its executive team.

Westpac has decided to form a smaller head office, restructuring its management team and creating two new divisions: corporate services; and customer services & technology.

Over time, the changes will contribute to head office functions being cut by around 20 per cent. They are one component to Westpac’s three-year plan, launched last year, to reduce its cost base to $8 billion by 2024.

The chief risk officer (CRO) and group executive for financial crime, compliance and conduct roles have been combined, reversing the bank’s decision post-royal commission to form an executive position dedicated to financial crime.

Instead, those duties have been consolidated under the CRO.

Advertisement
Advertisement

The men who held the two positions are set to depart: CRO David Stephen will leave in May after working with Westpac for more than three years, while Les Vance - group executive for financial crime, compliance and conduct - will also leave the group later in the year.

Mr Vance will continue to support the customer outcomes and risk excellence (CORE) program for a period, reporting to chief executive Peter King.

Replacing them as the new group CRO is Ryan Zanin, executive vice-president and chief risk officer of the Federal National Mortgage Organisation (Fannie Mae) in New York.

Mr Zanin’s commencement date with Westpac is subject to regulatory approval.

Previously, he has been CRO for GE Capital, Wells Fargo & Company and Deutsche Bank.

Meanwhile, the new corporate services division will consolidate the shared services functions of property, procurement, HR services, finance services, corporate affairs and community and sustainability.

It will be led by Carolyn McCann, group executive for customer and corporate relations.

The other new segment, customer services and technology, will be responsible for functions supporting customers, including operations, remediation, complaints and technology.

Scott Collary, current chief operating officer, will lead the division as group executive, customer services and technology.

Westpac’s headcount had also declined during the first quarter of its 2022 financial year under the simplification strategy, down 1,100 less workers. 

CEO Mr King commented the organisation is “streamlining… and lowering the cost of running the group”.

“The changes are primarily across head office and support functions, and not customer-facing roles. Bringing our workforce closer to the frontline, combined with the increases we have already made to the number of bankers, will further strengthen our franchise for customers,” he said.

The bank also issued a trading update for the first quarter of its 2022 reporting year, noting total loans had stepped up by $5 billion or 0.7 per cent from the quarterly average for the second half of the 2021 year, to a total book of $4.1 billion.

However the net interest margin for the first quarter was 1.91 per cent, down 8 basis points from the 2H21’s margin of 1.99 per cent.

But cash earnings were still up by 1 per cent from the quarterly average, to $1.5 billion, while the bank’s unaudited statutory net profit had surged by 80 per cent to $1.8 billion.

As Michael Rowland, chief financial officer at Westpac explained, the margin had declined in a low-interest rate environment, with “stiff competition, rising customer demand for lower rates and lower margin fixed rate lending.”

“Mortgages are very competitive and one of the biggest shifts actually has been the proportion of fixed rate in our mortgage book has moved from the 15 to 20 per cent mark up to 40 per cent,” Mr Rowland said in a media and analyst briefing.

“So we’ve had a material reshaping of the mortgage book and that was really the low point in fixed rates, [which] was really in the middle of last year and they’ve moved up from that point.”

Mr King also noted Westpac hadn’t been “the sharpest in fixed rates across the market”, which had impacted broker flows.

Recent APRA data showed Westpac wrote $2.5 billion in new owner-occupier loans during December, leaving its total at $256.5 billion, 0.9 per cent more than the month before.

Investor loans were up by $1.4 billion (a 0.8 per cent rise from November), to $171 billion.

[Related: New head of lending ops at AMP

Westpac restructures exec team
mortgagebusiness

Latest News

While the central bank went hard on its third consecutive 50-bp hike – without considering another option – the August minutes reveal it...

The state’s Premier has said residents impacted by this year’s floods will be offered buy-backs and land swaps, however no date has been...

Australia’s regional homes are following trends observed in capital cities, with prices dropping by 20 bps over the three months to July. ...

VIEW ALL

Join Australia's most informed brokers

Do you know which lenders are providing brokers and their customers with the best service?

Use this monthly data to make informed decisions about which lenders to use. Simply contribute to the survey and we'll send you the results directly to your inbox - completely free!

Do you think the new NSW property tax will help or hinder first home buyers?

Website Notifications

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