The multi-million dollar reasons Westpac exited wealth

australian-securities-exchange/ASX/westpac/BT-Panorama/protecting-your-super/

5 November 2019
| By Mike |
image
image image
expand image

The reasons for Westpac exiting its wealth management business were laid bare on the company’s balance sheet when it released its full-year results to the Australian Securities Exchange (ASX) on Monday.

The company’s detailed analysis of its operations painted a gloomy picture, even with respect to those elements of the wealth business Westpac retained – the insurance and platforms business.

The analysis showed that net wealth management and insurance income decreased by $994 million or 49% compared to 2018, impacted by additional provisions for notable items mostly related to financial planning of $531 million.

However, it said that excluding notable items, net wealth management and insurance income was down $463 million or 23% mainly due to:

  • No contribution from Hastings, following exit of the business in full year 2018 (down $203 million);
  • Insurance income decreased $116 million (general insurance down $69 million, life insurance down $39 million);
  • Lower platforms and superannuation income (down $98 million) primarily driven by margin compression from full year impact of platform repricing, implementation of regulatory reforms (Protecting Your Super), product mix changes and outflows in legacy platforms; and
  • Cessation of grandfathered commission payments (down $42 million).

The banking group said the lower platforms and superannuation income had been partly offset by an 89% increase in BT Panorama funds to $23 billion due to inflows and higher asset markets.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

The succession dilemma is more than just a matter of commitments.This isn’t simply about younger vs. older advisers. It’...

1 month ago

Significant ethical issues there. If a relationship is in the process of breaking down then both parties are likely to b...

2 months ago

It's not licensees not putting them on, it's small businesses (that are licensed) that cannot afford to put them on. The...

2 months 1 week ago

ASIC has canceled the AFSL of Sydney-based asset consultant and research firm....

5 days 6 hours ago

The Reserve Bank of Australia has announced its latest interest rate decision following this week's monetary policy meeting....

2 weeks ago

AMP has settled on two court proceedings: one class action which affected superannuation members and a second regarding insurer policies. ...

4 weeks 1 day ago

TOP PERFORMING FUNDS

ACS FIXED INT - AUSTRALIA/GLOBAL BOND
moneymanagement logo