Westpac Reports $1.7bn Profit Amid Economic Challenges

1

The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.

Alongside its financial results for the first quarter, Westpac highlighted a potential rise in unemployment, expecting it to reach 4.5% by mid-year, up from the current 4%. The economic environment remains challenging, with high cost-of-living pressures and subdued business demand affecting both consumers and businesses.

CEO Anthony Miller expressed concerns over economic challenges but noted positive signs, such as easing inflation. He suggested that this could lead to the Reserve Bank of Australia lowering the cash rate, providing some relief to households and potentially boosting business activity. Miller emphasised the bank's readiness to support customers facing financial strain.

In terms of loans, Westpac's lending activity has increased by 5% to a total of $820 billion, while deposits have grown by over 6% to $688 billion. The bank is also seeing an improvement in mortgage repayment health, with delinquent mortgages reducing slightly from $5.35 billion in September to $5.1 billion by December.

The bank's performance is a critical indicator of the broader Australian economy's health. Westpac's profitability and financial standing suggest stability, though concerns about rising unemployment and household financial pressures underline ongoing economic vulnerabilities. Furthermore, any potential interest rate changes by the Reserve Bank of Australia could have far-reaching implications for both consumers and the housing market.

Australia's economic climate remains uncertain. The projected rise in unemployment could temper consumer spending and business investment, affecting financial performance across various sectors. Expert insights will focus on monitoring inflation trends and policy changes, particularly interest rate adjustments, which might influence future financial strategies for both consumers and businesses. Investors will also be watching Westpac's share price performance closely following a notable dip post-results, despite a strong annual uptick of 33%.

Published:Tuesday, 18th Feb 2025
Source: Paige Estritori

Please Note: If this information affects you, seek advice from a licensed professional.

Share this news item:

Finance News

Clear

APRA's New Cap on High Debt-to-Income Home Loans: What Borrowers Need to Know

19 Dec 2025: Paige Estritori

The Australian Prudential Regulation Authority (APRA) has announced a significant policy change aimed at curbing potential risks in the housing market. Effective February 2026, APRA will implement a cap on high debt-to-income (DTI) home loans, limiting such loans to 20% of new home lending portfolios. This move is designed to address concerns over escalating property prices and accelerated credit growth. - read more

Afterpay Users Advised to Close Accounts for Mortgage Approval: A Closer Look

19 Dec 2025: Paige Estritori

Afterpay, a leading Australian buy-now-pay-later (BNPL) provider, has raised concerns over certain banking practices affecting its users. Reports indicate that some customers were advised to close their BNPL accounts to qualify for mortgages, only to be subsequently offered credit cards by the same financial institutions. - read more

Australia's Big Four Banks Shift Away from Mortgage Brokers: What It Means for Borrowers

19 Dec 2025: Paige Estritori

Australia's major banks-Commonwealth Bank of Australia (CBA), National Australia Bank (NAB), Westpac, and ANZ-are undergoing a strategic shift by reducing their reliance on mortgage brokers. This move aims to protect profit margins in the face of low interest rates, rising operational costs, and intense competition in the home loan market. - read more

December 2025 Sees a Dip in Australian Consumer Confidence

19 Dec 2025: Paige Estritori

In December 2025, Australia's consumer sentiment experienced a notable decline, reversing the positive momentum observed in the previous month. The Westpac-Melbourne Institute index fell by 9% to 94.5, indicating a shift back into pessimism among consumers. This downturn is primarily attributed to renewed concerns over inflation and the outlook for interest rates. - read more

APRA's New Cap on High DTI Home Loans: What Borrowers Need to Know

19 Dec 2025: Paige Estritori

The Australian Prudential Regulation Authority (APRA) has announced a significant policy change aimed at curbing high-risk lending practices within the housing market. Effective from 1 February 2026, APRA will implement a cap limiting banks to issuing no more than 20% of new home loans with debt-to-income (DTI) ratios of six times or higher. This measure applies to both owner-occupier and investor loans, excluding new housing developments. - read more

Click for more Finance News