Westpac braces for $1.03bn AUSTRAC hit

Westpac’s alleged child exploitation and money laundering scandal could blow a $1.03 billion hole in its first half cash profit, with the bank setting aside an eye-watering $900 million for a potential legal penalty.

The figure would eclipse the record $700 million fine Commonwealth Bank copped in 2018 for its own breaches of AUSTRAC laws. 

Westpac, which is accused of of 23 million breaches of anti-money laundering laws, flagged the hit on Tuesday as part of $1.43 million in expected first-half write downs and provisions. 

On top of the expected AUSTRAC fine, the bank said costs related to its financial crime response plan could reach $130 million, partly due to higher legal expenses.

The Big Four lender will also book another $260 million in customer remediation related to the Royal Commission, and a $70 million asset hit from the coronavirus fallout. 

An approximate $70 million provision has been made relating to changes to the provision of group life insurance.

Be the first to comment

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.