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

couple having a happy discussion with a banker
Healthcare Shares

Expert: 4 ASX healthcare stocks to buy ahead of reporting season

Could these ASX healthcare stocks be good additions to your portfolio?

Read more »

A man holding a cup of coffee puts his thumb up and smiles while at laptop.
Broker Notes

Morgans names 3 ASX stocks to buy

The broker is feeling very positive on the investment opportunities here.

Read more »

a man sits at his desk wearing a business shirt and tie and has a hearty laugh at something on his mobile phone.
Share Market News

3 of the best ASX shares to buy with $5,000

These shares could be among the best to buy now according to Bell Potter.

Read more »

A woman holds her finger to the side of her lips in contemplation as she looks upwards to an array of graphic images of light bulbs above her head, one of which is on and glowing.
Share Market News

Macquarie tips more than 15% upside for this ASX 200 utilities stock

This ASX 200 stock could be set to rise.

Read more »

A woman stands at her desk looking a her phone with a panoramic view of the harbour bridge in the windows behind her with work colleagues in the background.
Share Market News

5 things to watch on the ASX 200 on Friday

Will the market end the week strongly? Let's find out.

Read more »

A businessman stacks building blocks.
Share Gainers

Here are the top 10 ASX 200 shares today

ASX shares hit a new record high today.

Read more »

A man sees some good news on his phone and gives a little cheer.
Share Gainers

Why Auckland Airport, Australian Ethical, Breville, and Clarity shares are charging higher

These shares are having a better day than most on Thursday. But why?

Read more »

Shot of a young businesswoman looking stressed out while working in an office.
Share Fallers

Why 29Metals, CAR Group, DroneShield, and Santana Minerals shares are falling today

These shares are missing out on the good times on Thursday. But why?

Read more »