Westpac warns of significant housing market downturn, reports profit of A$6.99 billion amid rising credit impairment charges
Australian lender Westpac has warned of a significant housing market downturn and reported a substantial increase in credit impairment charges.For the year ending September 30, the bank’s net profit, excluding notable items, was A$6.99 billion (US$4.91 billion), aligning with market expectations.
Westpac projects a 10.9 per cent decline in house prices by March 2027, which would be steeper than previous downturns since 2008.
Housing outlook
The demand for mortgage and investor credit has decreased following the government’s removal of tax concessions for property investors earlier this year.
Average monthly mortgage applications in the fourth quarter fell by 15 per cent compared to the previous year.
Growth was observed in deposits and loans, increasing by 6.0 per cent and 5.0 per cent, respectively.
Westpac maintained its final dividend at 77 Australian cents per share.
The core net interest margin dropped 5 basis points to 1.76 per cent, while the CET1 ratio declined by 7.0 basis points to 12.46 per cent.
Westpac shares increased by 2.2 per cent to A$37.61, contrasting with a 0.4 per cent dip in the broader ASX200 index.
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