Westpac profits dive by 62 per cent, dividend slashed
Westpac has reported a 62 per cent fall in cash earnings for the year and will pay shareholders a sharply reduced dividend of 31 cents in what chief executive Peter King has described as disappointing results in a challenging year. The big four bank made $2.6 billion compared to $6.8 billion the same time last year and its statutory net profit was also down to $2.3 million, down 66 per cent over the year. Westpac's dividend is the maximum payment that could be made under the prudential regulator's guidance, against analyst forecasts of between zero and 35 cents, but comes in 61 per cent lower than last year's second-half dividend of 80 cents per share. The fully franked yield will be paid on December 18. The country's second largest bank did not pay a dividend in June, due to the uncertain economic outlook. Mr King said in a statement filed to the ASX on Monday morning Westpac's full-year earnings had been impacted by higher impairment charges, increased notable items and the sharp decline in economic activity brought on by the pandemic. "2020 has been a particularly challenging year and our financial result is disappointing," he said. "At the same time, we have incurred higher expenses due to increased resourcing to handle unprecedented COVID-19 demands and fixing our compliance issues."