Westpac fee for no service included in $235 million hit
Westpac has signalled a reduction of $235 million in cash earnings for the full year to address “customer issue” including advice remediation.
The big banking group acknowledged that the amount did not take account of any issues which might flow from the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.
In an announcement released to the Australian Securities Exchange *ASX), Westpac said the $235 million included:
- Increased provisions for customer refunds associated with certain advice fees charged by the Group’s salary financial planners due to more detailed analysis going back to 2008 including fees for service.
- Increased provisions for refunds to customers who may have received inadequate financial advice from Westpac planners.
- Additional provisions to resolve legacy issues as part of the Group’s detailed product reviews.
- Provisions for costs of implementing the three remediation processes and estimated provisions for recent litigation including costs and penalties associated with already disclosed responsible lending and bank bill swap rate issues.
Westpac said costs associated with responding to the Royal Commission were not included in the amounts.
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