Westpac Banking Corporation · ASX:WBC
Westpac Banking — 1Q19 Earnings Presentation
17 slides from Westpac Banking's earnings presentation, Feb 18, 2019
Slide 1: ASX Release: Westpac 1Q19 Update and Pillar 3 Report
ASX Release MONDAY 18 FEBRUARY 2019 WESTPAC 1Q19 UPDATE AND PILLAR 3 REPORT Westpac Banking Corporation has today released its Pillar 3 report for December 2018, along with slides providing further detail on asset quality, funding and capital. Westpac has also announced that unaudited statutory net
Slide 2: AASB 9 transitional impacts and contacts
Australian mortgage delinquencies were 4 basis points higher over the quarter while Australian unsecured delinquencies were also higher, up 10 basis points. On 1 October 2018 Westpac adopted AASB 9 and AASB 15. The models for implementation of these standards are still to be finalised and so current
Slide 3: 1Q19 Update Includes Capital, Funding & Credit Quality
1Q19 Update Includes Capital, Funding & Credit Quality 18 February 2019 Westpac Banking Corporation | ABN 33 007 457 141 Financial results based on cash earnings unless otherwise stated. Refer to the 2018 Full Year Investor Discussion Pack for definition. This document should be read in conjunction
Slide 4: Summary of 1Q19
Summary of 1Q19 Overview 2 • 1Q19 cash earnings of $2.04bn, up 6.9% on 2H18 quarterly average (0.5% lower than 2H18 average excluding $281m of remediation1 provisions) 1Q19 cash earnings • 1Q19 net profit after tax (statutory) of $1.95bn (cash earnings adjustments $0.09bn, mostly related to fair val
Slide 5: AASB 9 impacts
AASB 9 impacts AASB 9 3 Westpac implemented AASB 9 from 1 October 2018. As the models associated with implementation are still to be finalised, the impact for Westpac of AASB 9 may change. Final details will be provided as part of Westpac’s 1H19 update Impacted items Estimated change Detail • No cha
Slide 6: CET1 capital ratio, well positioned for 'unquestionably strong'
CET1 capital ratio, well positioned for ‘unquestionably strong’ Capital 4 Capital ratios (%) CET1 capital ratio (%) and CET1 capital ($bn) Mar-18 Sep-18 Dec-18 Westpac CET1 capital (lhs, $bn) Westpac CET1 capital ratio (rhs, %) CET1 capital ratio 10.5 10.6 10.4 APRA industry guidelines 10.5% Buildin
Slide 7: CET1 capital and RWA movements
CET1 capital and RWA movements Capital 5 CET1 capital ratio (% and bps) RWA movements ($bn) 1Q19 earnings, RWA 425.4 (1.6) 1.4 (4.7) Refer to slide 3 for details of (0.9) 419.6 movements and other capital 415.7 estimated AASB 9 impacts movements Down 1.4% 10.63 2 10.65 (69) 47 10.43 Mar-18 Sep-18 Cr
Slide 8: Well progressed on FY19 term funding
Well progressed on FY19 term funding Funding 6 1Q19 funding and liquidity highlights Term debt issuance and maturity profile1,2,5 ($bn) • LCR 128% (133% at 30 September 2018) Sub debt Senior/Securitisation Hybrid Covered bond • NSFR 112% (114% at 30 September 2018) 42 Issuance Maturities 37 • $9.1bn
Slide 9: Well provisioned, credit quality remains sound
Well provisioned, credit quality remains sound Credit quality 7 Total impairment provisions ($m) Stressed exposures as a % of TCE Estimated AASB 9 Overlay transition Watchlist & substandard Collectively assessed provisions 90+ day past due and not impaired Estimated AASB 9 2.17 transition added 7bps
Slide 10: Credit quality areas of interest
Credit quality areas of interest Credit quality 8 Mining (including oil and gas) portfolio Retail trade portfolio Mar-18 Sep-18 Dec-18 Mar-18 Sep-18 Dec-18 Total committed exposures (TCE) $9.3bn $10.7bn $10.0bn Total committed exposures (TCE) $15.5bn $16.2bn $16.4bn Lending $5.1bn $5.7bn $5.4bn Lend
Slide 11: Australian consumer unsecured lending, 3% of Group loans
Australian consumer unsecured lending, 3% of Group loans Credit quality 9 Australian consumer unsecured lending portfolio 90+ day delinquencies (%) by State Mar-18 Sep-18 Dec-18 NSW/ACT VIC/TAS QLD WA SA/NT 3.0 Lending $21.8bn $21.1bn $20.6bn 2.0 30+ day delinquencies (%) 3.95 3.65 3.90 90+ day deli
Slide 12: Australian mortgage portfolio continues to perform well
Australian mortgage portfolio continues to perform well Credit quality 10 Australian mortgage delinquencies and Portfolio delinquencies (%) Mar-18 Sep-18 Dec-18 properties in possession (PIPs) 90+ day past due total 90+ day past due investor 30+ day delinquencies (bps) 144 140 146 3.0 30+ day past d
Slide 13: Australian mortgage portfolio trends
Australian mortgage portfolio trends Credit quality 11 Switching from I/O to P&I1 ($m) Proportion of I/O in total portfolio (%) Reached end of I/O period Customer initiated Settlements – 23% of new flows2 4,042 4,717 4,025 3,788 4,044 46 40 35 32 4,110 4,149 4,793 3,911 3,623 1Q18 2Q18 3Q18 4Q18 1Q1
Slide 14: Appendix 1: Definitions – Credit quality
Appendix 1: Definitions – Credit quality Appendix and Disclaimer 12 Includes facilities where: Includes exposures that have deteriorated to the point where full collection • contractual payments of interest and / or principal are 90 or more of interest and principal is in doubt, based on an assessme
Slide 15: Appendix 1: Definitions – Capital and liquidity
Appendix 1: Definitions – Capital and liquidity Appendix and Disclaimer 13 Capital Liquidity Committed The RBA makes available to Australian Authorised Deposit-taking Capital ratios As defined by APRA (unless stated otherwise) liquidity facility Institutions a CLF that, subject to qualifying conditi
Slide 16: Investor Relations Team
Investor Relations Team Contact us 14 Equity Investor Relations www.westpac.com.au/investorcentre Andrew Bowden Nicole Mehalski Annual reports Presentations and webcasts Head of Investor Relations Director +61 2 8253 4008 +61 2 8253 1667 5 year financial summary andrewbowden@westpac.com.au nicole.me
Slide 17: Disclaimer
Disclaimer 15 The material contained in this presentation is intended to be general background information on Westpac Banking Corporation (Westpac) and its activities. The information is supplied in summary form and is therefore not necessarily complete. It is not intended that it be relied upon as