SYDNEY, May 4 — Westpac announced today its half-year net profit had fallen 62 per cent, making it the latest Australian bank to see profits dive during the coronavirus crisis.
The bank reported a profit of A$1.19 billion (RM3.3 billion) in the first half of the financial year, down 62 per cent compared to the same period in 2019.
Westpac Group CEO Peter King said the bank had set aside A$2.24 billion in impairment charges, including A$1.6 billion to tackle the impact of the virus and A$900 million for a potential penalty from financial intelligence agency AUSTRAC.
The regulator has accused Westpac of committing 23 million breaches of money laundering and counterterrorism rules in “serious and systemic” law-breaking involving more than A$11 billion.
“This is the most difficult result Westpac has seen in many years,” King said.
“It is significantly impacted by higher impairment charges due to Covid-19, as well as notable items including the AUSTRAC provision.”
King said Australia was facing a “sharp economic contraction” in 2020 with a rebound not expected until the December quarter.
But he said the bank retained a strong balance sheet and ample liquidity.
It comes after ANZ Bank said its half-year after-tax profits had fallen 50 per cent and NAB reported a 25 per cent drop in profits.
Like ANZ, Westpac deferred a decision on interim shareholder dividend payments due to the ongoing economic uncertainty.
Westpac said it had also deferred more than 100,000 home loans and 30,000 business loans worth a total of A$47 billion, as part of a government programme to ease pressure on Australians during the country’s virus shutdown. — AFP
