Westpac Banking Corp has taken a A$1.2 billion (S$1.16 billion) charge against second-half earnings to cover a record money-laundering fine and the mounting cost of compensating customers for years of misconduct.

The charge is the latest blow to Australia’s oldest bank, which last month was hit with a A$1.3 billion penalty for the country’s biggest breach of anti-money laundering laws. Earlier this year it deferred paying a dividend as bad-debt charges swelled amid the coronavirus-induced recession.

Among the charges announced on Monday (Oct 26) were:

• A$415 million for the money-laundering fine, including legal costs. Westpac had previously provisioned A$900 million for a settlement, but the cost blew out after further breaches were uncovered.

• A$568 million to write down the value of its life insurance and auto-finance units, as well as software

• A$182 million to compensate customers, including business borrowers and wrongly-charged insurance fees

• A$55 million from asset sales and revaluations

The original full article can be found at straitstimes.com

(Photo: Mark Metcalfe/Getty Images)