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Westpac posts cash earnings decline

Westpac posts cash earnings decline

Westpac (ASX:WBC) said its cash earnings fell 2% in the third quarter, despite a 2% increase in operating income.

The company posted cash earnings of $1.55 billion, and net profit of $1.45 billion.

While core earnings before impairment charges and taxes grew 2%, impairment charges and customer costs also rose.

CEO Gail Kelly said the company had faced slowing system credit growth and weaker markets during the quarter, as a result of increasingly shaky consumer sentiment and a increased de-leveraging among larger businesses.

“Notwithstanding these trends, momentum across the group has been sound,” Kelly said.

Lending increased 1% sequentially over the quarter, driven by solid growth in Australian and New Zealand mortgages.

Net interest margins improved to 2.08%, up 4 basis points when excluding the beneficial impact of volatile and one-off items.

Kelly said Westpac's liquid assets grew from $85 billion to $89 billion over the quarter, and its Tier 1 capital ratio improved 12 basis points to 9.65%.

WBC shares fell 4.35% in Tuesday's trading to $20.250.

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Tags Westpacfinancial resultsbankingGail Kellyconsumer confidenceASX:WBC

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