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Westpac to spend $260m extra compensating customers


Westpac will spend another $260 million to compensate customers affected by its “errors”, taking its total remediation payments so far to $659 million.

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The bank made the announcement to the Australian Stock Exchange this morning.

In the statement, it said that about half of the $260 million cost was related to financial advice and the remainder related to business banking – including providing businesses with loans when it should not have – and consumer banking, including failing to switch interest-only loans when required to principal-and-interest loans.

The provision will be recorded in Westpac’s first-half results, and follows $118 million set aside in the 2017 financial year and $281 million in 2018.

“We are determined to fix these issues and stop these errors occurring again,” chief executive Brian Hartzer said.

The lender said it is still trying to calculate fee-for-no-service refunds for customers of authorised advisers.

“We will continue to review our products and services to ensure they deliver the right outcomes for customers and, if necessary, make further provisions,” he said.

Westpac said it would assess provisions for authorised representatives as part of its first-half results, which are due to be published on May 6.

Westpac shares fell about 1.5 per cent in the first few minutes of trade.


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