Westpac has rebounded from their slump in 2020 by posting strong results for the first half of 2021. Shares jumped by 4% as a result of the announcement this morning.
The Big Four bank recorded a higher profit than expected, with cash earnings up 256% and statutory net profits up 189% on the same period in 2020.
The results marked a comeback from Westpac, who have engaged in a series of cost-cutting measures and internal structural changes. The bank have quickened the pace of their digital transformation and streamlined head office in an attempt to reverse their fortunes, and it appears to be paying off.
The boom in the housing market also helped to swell the coffers, with more than $2.6 billion added to the mortgage book since the start of the year.
“First half earnings were considerably higher than the prior corresponding period, mainly due to an impairment benefit reflecting improved asset quality and a better economic outlook,” said CEO Peter King.
“Notable items were also lower. We improved balance sheet strength, with our Common Equity Tier 1 capital ratio rising 153 basis points to 12.34 per cent. Importantly, we are beginning to see the benefits of our new operating model through improved performance.
“Our Australian mortgage book increased $2.6 billion over the past six months, with good growth in owner occupier loans partly offset by lower investor lending. Owner occupier loans increased 3 per cent, with first home buyers making up 13 per cent of new loans.”