Westpac has reported substantial growth within its business banking division, with lending increasing by 15 per cent in the year leading up to June. This growth has outpaced the broader market and contributed to a 19 per cent return on tangible equity. The Business and Wealth segment accounted for 32 per cent of Westpac’s net profit during the first half of the year. Westpac is one of Australia’s largest banking and financial services institutions, serving millions of customers. The company offers a wide range of products and services, including personal, business, and institutional banking.
While business lending has surged, net interest margins experienced a slight decline of 22 basis points. This decrease is attributed to increased competition within the financial sector and a higher proportion of lower-risk lending impacting overall returns. Despite these pressures on margins, Westpac’s deposit base saw a healthy increase of 5 per cent, reaching $151 billion. This growth pushed the division’s deposit-to-loan ratio to a solid 134 per cent.
A significant contributor to the deposit growth was the strong performance of transaction accounts, with over 128,000 new accounts opened during the year, representing a 10 per cent increase. Looking ahead, Westpac has outlined plans to further bolster its business banking operations.
The bank intends to hire an additional 350 business bankers by 2027. It has already added 135 business bankers year-to-date. This strategic expansion aims to strengthen Westpac’s connections with its existing base of 340,000 business and wealth clients.
