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Westpac half-year profits fall 1.2 percent

Westpac half-year profits fall 1.2 percent

Westpac Group, Australia's largest bank by market value, said Wednesday its half-year net profit fell 1.2 percent, and it slashed its dividend payment to shareholders after costs from bad debts blamed on the global downturn tripled.
Cash earnings plunged 6 percent in the six months to March 31, canceling out a rise in revenue stemming from Westpac's takeover last year of smaller rival St. George Bank.
Net profit after tax fell 1 percent to 2.18 billion Australian dollars ($1.6 billion) for the half compared to the year-earlier period, the Sydney-based bank said in documents filed with the Australian Securities Exchange.
Provisions for bad loans soared to AU$1.6 billion ($1.2 billion) from AU$541 million in the same period the previous year because of the crisis in financial markets and the economic slowdown, the bank said.
The bank will cut its interim dividend payment by 20 percent to AU$0.56 to allow managers to be more conservative with the group's capital.
"While it is disappointing to announce an overall decline in cash earnings, the group's performance demonstrates that we have strong, diversified and resilient business," CEO Gail Kelly said in a statement.
The big four banks that dominate the sector in Australia have been battered by the global financial crisis, but not as badly as counterparts in the United States and Europe thanks to tighter regulation and low levels of exposure to subprime-type loans.
Last month, the Australia & New Zealand Banking Group Ltd. reported a 28 percent drop in profit for the six months ending March 31 to AU$1.42 billion and National Australia Bank Ltd. said its first-half net fell 0.9 percent to AU$2.7 billion. Both reported significant rises in bad loans.
Westpac is Australia's oldest bank, with retail banking and financial services operations in New Zealand and the South Pacific as well as Australia that serve some 10 million customers, and offices in London, New York, Hong Kong and Singapore.


Updated : 2021-08-04 05:39 GMT+08:00