InDaily InDaily

Support independent Journalism Donate Subscribe
Support independent journalism

Westpac profit plummets by 62 per cent

News

Westpac has deferred a decision on paying an interim dividend to shareholders after posting a 70 per cent drop in first-half cash earnings following a hefty impairment charge due to the coronavirus outbreak.

Print article

Australia’s second-largest lender reported cash earnings fell to $993 million for the six months ended March 31, from $3.30 billion a year earlier.

Net profit was down 62 per cent to $1.19 billion.

This follows its announcement last week of a $1.6 billion impairment charge for potential loan defaults due to the COVID-19 related shutdown.

It has also provisioned $900 million for a potential legal penalty from AUSTRAC proceedings related to breaches of anti-money laundering laws.

“This is the most difficult result Westpac has seen in many years. It is significantly impacted by higher impairment charges due to COVID-19, as well as notable items including the AUSTRAC provision,” Westpac Group chief executive Peter King said in a statement.

“In light of the changed economic outlook we have increased Westpac’s provisions for expected credit losses to $5.8 billion, which includes approximately $1.6 billion of additional impairment charges predominantly related to COVID-19 impacts,” he said.

Westpac joins smaller rival ANZ in holding off paying shareholders an interim dividend after that lender also posted a 62 per cent slide in its first-half cash profit due to the COVID-19 hit.

Westpac had paid a fully franked interim dividend of 94 cents a share a year ago.

-AAP

Want to comment?

Send us an email, making it clear which story you’re commenting on and including your full name (required for publication) and phone number (only for verification purposes). Please put “Reader views” in the subject.

We’ll publish the best comments in a regular “Reader Views” post. Your comments can be brief, or we can accept up to 350 words, or thereabouts

Help our journalists uncover the facts

In times like these InDaily provides valuable, local independent journalism in South Australia. As a news organisation it offers an alternative to The Advertiser, a different voice and a closer look at what is happening in our city and state for free. Any contribution to help fund our work is appreciated. Please click below to donate to InDaily.

Donate here
Powered by PressPatron

More News stories

Loading next article