APRA and ASIC drop Westpac investigation

by Mike Wood13 Mar 2021

ASIC and APRA have called time on their investigation of Westpac for potential breaches of the Banking Act, putting an end to one of the biggest dramas in the financial sector.

APRA announced that they had ended their investigation into Westpac, which had been underway since late 2019. It had begun after the Australian Transaction Reports and Analysis Centre (AUSTRAC) made allegations that the Big Four bank had broken rules pertaining to money laundering and counter-terrorism.

Last June, APRA instructed ASIC to broaden the investigation, adding breaches of the Corporations Act to the ongoing case under the Banking Act.

“Having carefully considered the results of ASIC’s investigation, APRA has determined to close its investigation,” read APRA’s statement. “Westpac remains subject to a court enforceable undertaking (CEU) to implement an integrated risk governance remediation plan to uplift risk governance across its business with ongoing independent review over its progress.”

“The $1 billion operational risk capital add-on, which reflects the bank’s heightened operational risk profile, will also remain in place until Westpac completes its remediation under the CEU to APRA’s satisfaction.”

Beyond that news on Friday, the main stories of the week surrounded International Women’s Day, which was celebrated on Monday, and the property price boom and its effect on interest rates.

Several reports were released that highlighted the gap between female and male brokers: the MFAA’s Opportunities for Women Report showed how attitudes are changing within the industry, with more and more male brokers appreciating the lack of gender diversity.

Westpac slashed their interest rates as part of an ongoing price war within in the Big Four banks, built on spiralling house prices. Sydney surpassed its previous peak, back in 2017, to reach new heights for property prices.