Westpac earnings to reduce by $1.22b
Westpac’s 2H20 cash earnings will be reduced by $1.22 billion with $415 million (after tax) accounting for AUSTRAC matters, the bank announced to the Australian Securities Exchange (ASX).
The bank said it had increased its penalty provision by $400 million in 2H20, in addition to the $900 million raised in 1H20. There was another $20 million in costs of remediating identified issues in 2H20, along with legal costs, including AUSTRAC’s legal costs of $4 million.
Another $568 million was for the write-down of goodwill and intangibles associated with Westpac Life Insurance Services and its Auto Finance business along with the write-down of capitalised software.
An increase in provisions for customer refunds, repayments, associated costs, and litigation provisions came to $182 million.
A further $55 million was reduced from earnings from asset sales and revaluations. This included the revaluation of life insurance liabilities and a loss on the agreed sale of its vendor finance business.
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