Westpac Banking Corporation · ASX:WBC
Westpac Banking — Q1 2018 Earnings Presentation
15 slides from Westpac Banking's earnings presentation, Feb 5, 2018
Slide 1: 1Q18 Capital, Funding and Asset Quality Update
200 years proudly supporting Australia 1Q18 Capital, Funding and Asset Quality Update 5 February 2018 This document should be read in conjunction with Westpac’s Pillar 3 Report December 2017, incorporating the requirements of APS330. All comparisons in this document refer to 31 December 2017 compare
Slide 2: Summary of 1Q18 Capital, Funding and Asset Quality
Summary of 1Q18 Capital, Funding and Asset Quality Overview 2 • Common equity Tier 1 (CET1) capital ratio 10.1% at 31 December 2017 down from 10.6% at September 2017. The 2H17 dividend (net of DRP) reduced the CET1 capital ratio by 70bps. Excluding the impact of the Well placed to meet dividend, the
Slide 3: Capital well positioned for APRA changes
Capital well positioned for APRA changes Capital 3 CET1 capital ratio (%) and CET1 capital ($bn) Capital ratios (%) (APRA basis) Mar-17 Sep-17 Dec-17 Westpac CET1 capital (lhs, $bn) APRA industry Westpac CET1 capital ratio (rhs, %) guidelines >10.5% CET1 capital ratio 10.0 10.6 10.1 unquestionably $
Slide 4: CET1 capital and RWA movements
CET1 capital and RWA movements Capital 4 CET1 capital ratio (%) CET1movements RWA capital ratio($bn) (%) 6.6 (0.5) 0.5 (0.5) 410.3 1Q18 earnings, RWA movements and other capital 404.4 404.2 10.6 (0.7) movements Up $6.1bn or 1.5% 0.2 10.1 10.0 Market Mar-17 Other Credit IRRBB Dec-17 Sep-17 RWA risk C
Slide 5: Well progressed on FY18 term funding
Well progressed on FY18 term funding Funding and liquidity 5 1Q18 funding and liquidity highlights 1Q18 new term issuance composition1 (%) • LCR 116% (124% at 30 September 2017) By type By currency • Estimated NSFR 110% (109% at 30 September 2017) • Well progressed on FY18 term funding plan, with $1
Slide 6: Asset quality remains sound
Asset quality remains sound Asset quality 6 Stressed exposures (as a % of TCE) Highlights • Stressed exposures to TCE down 2bps to 1.03% Watchlist & substandard • Total stressed assets $10.4bn ($0.2bn lower) 90+ day past due (dpd) and not impaired − Impaired assets stable ($1.5bn) 3.20 Impaired − 90
Slide 7: Stressed exposures lower across industries
Stressed exposures lower across industries Asset quality 7 Corporate and business portfolio stressed exposures by industry ($bn) 2.0 Mar-17 Sep-17 Dec-17 1.8 1.6 Downgrade of 3 1.4 names into watchlist Reduced exposure of existing facilities 1.2 and upgrades 1.0 0.8 0.6 0.4 0.2 0.0 Wholesale & Const
Slide 8: Asset quality areas of interest
Asset quality areas of interest Asset quality 8 Mining (inc. oil and gas) portfolio New Zealand dairy portfolio Retail trade portfolio Sep-17 Dec-17 Sep-17 Dec-17 Sep-17 Dec-17 Total committed exposures (TCE) $9.7bn $9.7bn Total committed exposure NZ$6.0bn NZ$6.0bn Total committed exposures (TCE) $1
Slide 9: Australian consumer unsecured lending
Australian consumer unsecured lending Asset quality 9 Australian consumer unsecured lending portfolio 90+ day delinquencies (%) by State Mar-17 Sep-17 Dec-17 NSW/ACT VIC/TAS QLD WA SA/NT 30+ day delinquencies (%) 3.99 3.60 3.76 3.0 90+ day delinquencies (%) 1.63 1.66 1.66 2.0 Estimated impact of cha
Slide 10: Australian mortgage delinquencies remain low
Australian mortgage delinquencies remain low Asset quality 10 Australian mortgage delinquencies and properties in possession (PIPs) Mar-17 Sep-17 Dec-17 Australian mortgage portfolio delinquencies 90+ day past due total 90+ day past due investor 30+ day delinquencies (bps) 139 130 135 3.0 30+ day pa
Slide 11: Mortgages - comfortably operating within macro-prudential limits
Mortgages - comfortably operating within macro-prudential limits Asset quality 11 Flow of interest only1 (% of total limits) Switching from I/O to P&I2 ($m) Mortgage lending growth (%) Applications Settlements Reached end of I/O period Customer initiated Investor 3 Owner occupied APRA 9.8 requiremen
Slide 12: Appendix 1: Definitions
Appendix 1: Definitions Appendix 12 Capital ratios As defined by APRA (unless stated otherwise) High quality Assets which meet APRA’s criteria for inclusion as HQLA in the liquid numerator of the LCR assets Assets (both on and off-balance sheet) are risk weighted according (HQLA) Risk weighted to ea
Slide 13: Appendix 1: Definitions
Appendix 1: Definitions Appendix 13 Includes exposures that have deteriorated to the point where full Stressed Stressed assets are the total of watchlist and substandard, 90 days collection of interest and principal is in doubt, based on an assets past due and not impaired and impaired assets assess
Slide 14: 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 15: Disclaimer
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 reli