UK markets closed
  • NIKKEI 225

    25,527.37
    -106.93 (-0.42%)
     
  • HANG SENG

    26,486.20
    +34.66 (+0.13%)
     
  • CRUDE OIL

    43.08
    +0.66 (+1.56%)
     
  • GOLD FUTURES

    1,835.50
    -36.90 (-1.97%)
     
  • DOW

    29,527.23
    +263.75 (+0.90%)
     
  • BTC-GBP

    13,788.39
    -83.78 (-0.60%)
     
  • CMC Crypto 200

    363.08
    +1.65 (+0.46%)
     
  • ^IXIC

    11,875.06
    +20.09 (+0.17%)
     
  • ^FTAS

    3,582.28
    -4.23 (-0.12%)
     

Westpac Takes A$1.2 Billion Charge for Laundering, Refunds

Edward Johnson
·1-min read

(Bloomberg) -- Westpac Banking Corp. has taken a A$1.2 billion ($871 million) charge against second-half earnings to cover a record money-laundering fine and the mounting cost of compensating customers for years of misconduct.

The charge is the latest blow to Australia’s oldest bank, which last month was hit with a A$1.3 billion penalty for the country’s biggest breach of anti-money laundering laws. Earlier this year it deferred paying a dividend as bad-debt charges swelled amid the coronavirus-induced recession.

Among the charges announced Monday were:

A$415 million for the money-laundering fine, including legal costs. Westpac had previously provisioned A$900 million for a settlement, but the cost blew out after further breaches were uncovered.A$568 million to write down the value of its life insurance and auto-finance units, as well as softwareA$182 million to compensate customers, including business borrowers and wrongly-charged insurance feesA$55 million from asset sales and revaluations

Chief Executive Officer Peter King is seeking to restore the bank’s battered reputation after the money-laundering scandal led to the departure of predecessor Brian Hartzer. Westpac shares rose 0.7% in early Sydney trading, paring this year’s decline to 22%.

Westpac releases full-year results Nov. 2.

(Adds share price in fourth paragraph.)

For more articles like this, please visit us at bloomberg.com

Subscribe now to stay ahead with the most trusted business news source.

©2020 Bloomberg L.P.