Westpac Banking (WBC) investor relations material

Executive summary

• Statutory net profit for the quarter was $1.9bn, up 5% compared to the 2H25 average, with net profit excluding notable items up 6% over the same period, reflecting disciplined execution of strategic priorities.

• Revenue rose 1% year-over-year, with net interest income up 2% and non-interest income down 4% due to lower markets revenue.

• Operating expenses decreased by 5% compared to the 2H25 average, supporting a 7% increase in pre-provision profit; expenses were stable excluding prior restructuring charges.

• Customer deposits grew by $12bn, with household deposits up 3% and business transactional deposits up 4%.

• Loans increased by $22bn, led by 7% growth in institutional lending and 3% in Australian mortgages (ex-RAMS) and business.

Financial highlights

• Net interest margin (NIM) was 1.94%, down 1 basis point from the previous quarter; core NIM declined 3 basis points to 1.79%.

• Return on equity (ROE) improved to 10.4%, up 46 basis points from the 2H25 average.

• Operating expenses, excluding restructuring, were stable at $3bn.

• Credit impairment charges remained low at 6 basis points of average gross loans, though up 44% sequentially.

• CET1 capital ratio at 12.3%, reduced by the full year 2025 dividend payment.

Outlook and guidance

• Deposit growth expected to remain strong through FY 2026.

• Institutional lending growth expected to moderate for the remainder of FY 2026.

• Expense growth for FY 2026 anticipated to be largely offset by productivity savings, with over $500m targeted.

• Economic scenarios for credit loss provisioning assume GDP growth of 2.2% in 2025 and 2.4% in 2026, with unemployment rising to 4.6%.

• Optimistic on economic outlook, expecting resilient demand for business and household credit.