Westpac (ASX:WBC) share price lower on AGM update

The Westpac Banking Corp (ASX:WBC) share price is trading lower following the release of its annual general meeting update…

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Westpac Banking Corp (ASX: WBC) share price is trading lower on the day of its annual general meeting.

At the time of writing, the banking giant's shares are down 0.5% to $19.89.

What did Westpac say at its annual general meeting?

At the meeting the bank provided investors with a summary of its performance in FY 2020 and its targets for the future.

Speaking about FY 2020, Westpac's Chief Executive Officer, Peter King, revealed that he was disappointed with the company's performance.

He said: "The 2020 financial year was clearly disappointing, with reported profit down 66%. Much of the fall was due to our own issues, including the AUSTRAC penalty. COVID directly impacted us contributing to slower loan growth, lower margins, higher expenses, and a material increase in impairment charges."

The Chief Executive also touched on the AUSTRAC matter, which weighed heavily on both its performance and the bank's priorities over the last 12 months.

Mr King commented: "Shareholders are rightly disappointed. This simply should not have happened, and I apologise. I also recognise that the civil penalty and the impact of COVID resulted in lower dividends and this made it hard for many of you."

"While our failings were not intentional, significant changes and consequences have occurred. This included Board and management changes along with remuneration consequences for those in the chain of responsibility. I and the Executive team also took collective accountability with 2020 short-term variable rewards cancelled," he added.

Outlook.

Westpac has been encouraged by the quick economic recovery since the height of the pandemic and expects it to continue in 2021.

Though, Mr King acknowledges that not all of the bank's customers will recover as quickly.

"The Government's support has played a critical role in helping Australian families and keeping businesses afloat and we expect the economic recovery to continue through next year. Nevertheless, some customers will find conditions difficult. The gradual unwinding of Government support must be offset by increased activity if we are to minimise the impacts on customers," he commented.

The Chief Executive concluded by confirming the bank's aim to simplify its business and create value for shareholders.

He said: "At the same time, we are working hard to resolve our issues and simplify the business. We are underway but have much more to do. As CEO, my role is to build sustainable long-term value for shareholders, and I am personally committed to see this through."

"Shareholder value is created by a strong customer franchise; strong relationships; and by being there for customers when they need us. Right now, that means supporting customers and the economy through this pandemic," Mr King concluded.

Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

happy teenager using iPhone
Share Gainers

Up 96% since April, should I still buy Life360 shares today?

A leading expert offers his verdict on the growth outlook for the surging Life360 share price.

Read more »

Smiling man with phone in wheelchair watching stocks and trends on computer
Share Market News

5 things to watch on the ASX 200 on Wednesday

Another good session is expected for Aussie investors today.

Read more »

Businessman smiles with arms outstretched after receiving good news.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a lucrative return to trading for investors this Tuesday.

Read more »

Business man at desk looking out window with his arms behind his head at a view of the city and stock trends overlay.
Broker Notes

Leading brokers name 3 ASX shares to buy today

Here's why brokers believe that now could be the time to snap up these shares.

Read more »

Warren Buffett
Share Market News

$10,000 invested in Berkshire Hathaway shares 5 years ago is now worth…

The past 5 years have been especially fruitful for Berkshire Hathaway investors.

Read more »

Frustrated stock trader screaming while looking at mobile phone, symbolising a falling share price.
Share Fallers

Why Coronado Global, Genesis Minerals, Monash IVF, and Platinum shares are sinking today

These shares are starting the week in the red. But why?

Read more »

A man sits in a chair hunched over a laptop and covered head to toe in frozen icicles to represent Envirosuite's trading halt
Mergers & Acquisitions

Johns Lyng Group shares enter trading halt. Is it a takeover target?

This ASX 200 stock looks ripe for a takeover.

Read more »

A man clenches his fists in excitement as gold coins fall from the sky.
Share Gainers

Why Austal, Botanix, DroneShield, and NextDC shares are storming higher today

These shares are starting the week with a bang. But why?

Read more »