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Westpac has followed through on its intention to sell its insurance business to Allianz for $725 million and will enter into an exclusive 20-year agreement for the distribution of general insurance products to Westpac’s customers.
It announced last December it would sell Westpac General Insurance and Westpac General Insurance Services to Allianz.
A further payment of $25 million was expected to be received by Westpac this calendar year subject to integration milestones, with contingent payments over the next five years in addition to ongoing payments under the distribution agreement.
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3 May, 2021 Author Ranina Sanglap
Westpac Banking Corp. is seeking to slash its costs by nearly 40% in four years by shedding some specialist businesses, scaling back on branches and improving its processes after a recovery in the Australian economy from the COVID-19 pandemic helped the lender grow its profit three-fold in its fiscal first half of the year.
Australia s third-biggest bank by assets aims to have a cost base of A$8 billion by 2024, compared with A$12.7 billion in the last fiscal year that ended September 2020, a plan some analysts think may be tough to achieve.
CEO Peter King said at a May 3 call with analysts and reporters that Westpac plans to spend between A$3.5 billion and A$4.0 billion over the next three years in measures to cut its cost base, including an improvement in its processes and risk management systems. The significant customer remediation costs the company has been forced to incur
Westpac eyes ambitious cost-cuts via simplified operations, asset sales spglobal.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from spglobal.com Daily Mail and Mail on Sunday newspapers.
Mortgage Business
Westpac earnings to dip by $280m By Malavika Santhebennur 27 April 2021
The lender has said its cash earnings will be reduced in 1H21 due to notable items, including write-down of goodwill related to lender’s mortgage insurance.
Westpac has announced that its cash earnings in the first half of the 2021 financial year (1HFY21) will be reduced by $282 million (after tax), while its statutory net profit will also be reduced due to what it said are notable items.
The notable items after tax include the write-down of goodwill in the group’s lenders mortgage insurance business as it is now held for sale.