Westpac's Peter King says the heavy lifting is done. Now comes the hard part.
Investors loved the Westpac result but a much weaker second half and a very ambitious tech renovation program provide warning signs beyond a welcome share buyback.
Westpac boss Peter King has been around too long to comment on daily share price movements, but an acute spike in his bank’s share price on the release of a nominally as-expected annual profit would surely have brought some smiles.
Australia’s oldest commercial company, dating back more than 200 years, has seen a few cycles and nearly died in 1992. It's been through a particularly bleak period in the last few years, having been pilloried in the Royal Commission and losing a chief executive and a chair following a money laundering scandal. A regulator-imposed capital penalty of $1 billion still has a few years to run.
But now, King tells Capital Brief, the bank is back on track, albeit still some distance from where he wants it to be — number two overall in the market with a much stronger small business bank and a return to its once dominant position in institutional banking.
The major portfolio work is done: “We've exited insurance, general and life, superannuation. We're out of auto finance … financial planning. So we've done the heavy lifting on getting the portfolio to where we want. So now it's about improving the efficiency, improving the service and getting some growth in those key businesses.”
