Westpac posts $1.7bn quarterly profit, flags rising unemployment
A major Australian bank has posted a massive three-month profit as it expects one thing to rise in the coming months.
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Westpac has posted a $1.7bn quarterly profit despite earnings falling almost 10 per cent.
In first quarter results posted on Monday, Westpac flagged weak demand for businesses and unemployment to peak at 4.5 per cent this year – up from the current 4 per cent.
“Cost-of-living pressures and high interest rates remain challenging for some customers, while many businesses face cost pressures and lower demand,” chief executive Anthony Miller said.
“Encouragingly, inflation has eased and we could see the Reserve Bank of Australia reduce the cash rate as early as tomorrow.
“This should provide some relief to households and, over time, support business activity. We encourage customers to call us if they need help.”
Westpac’s $1.7bn net profit for the three months to the end of December is a 9 per cent fall on the average of the past two quarters.
Under-stress mortgage holders almost made sizeable dents in their repayments in the final three months of 2024. Westpac was carrying more than $5.35bn of unsecured and/or 90-days late mortgages in September. By December, that number had shrunk to $5.1bn.
Consumers are depositing and borrowing more from Australia’s oldest bank. Lending rose 5 per cent for the calendar year to $820bn and deposits climbed to $688bn, up more than 6 per cent.
However, Westpac is banking on a rise in unemployment this year, working on assumptions the benchmark would rise to 4.5 per cent by mid-year. That is above the current 4 per cent number but paired back from Westpac’s early 4.7 per cent forecast.
Westpac shares are up 33 per cent over the past 12 months. However, in the hours after the quarterly results were posted, the share price had fallen 5.4 per cent to $32.82, a bigger dip than the other major banks.
Originally published as Westpac posts $1.7bn quarterly profit, flags rising unemployment
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