The Westpac Banking Corp (ASX: WBC) share price is falling on Thursday morning.
At the time of writing, the banking giant's shares are down almost 1% to $20.64.
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Why is the Westpac share price falling?
Investors have been selling the banking giant's shares today after the company released an update on the one-off items it expects to include with its upcoming FY 2023 results.
According to the release, Westpac's reported net profit after tax in FY 2023 will be reduced by a total of $173 million due to notable items.
While this is certainly a large number, it is significantly lower than in FY 2022. For that financial year, Westpac's notable items came in at $874 million.
What are the items?
Westpac explained that its one-off notable items for FY 2023 include the following:
- Sale of the Advance Asset Management business – $256 million profit.
- An increase in provisions for customer refunds, repayments, associated costs and litigation including costs associated with the one-off levy for the Commonwealth's Compensation Scheme of Last Resort – $176 million loss.
- Restructuring costs associated with organisational simplification and the discontinuance of specialist businesses – $140 million loss.
- The write-down of assets and costs related to reducing our corporate and branch footprint – $87 million loss.
- Unrealised fair value gains and losses on economic hedges and net ineffectiveness on qualifying hedges – $26 million loss.
In respect to the Westpac's all-important common equity tier 1 (CET1) capital ratio, the bank expects these one-offs to impact it by 4 basis points.
Westpac will be kicking off reporting season in the banking sector with the release of its FY 2023 results next month on 6 November.
