Key Takeaways
- Westpac (WBC) reported a full-year 2025 net income of A$6.92 billion, slightly below analyst estimates, with a strong second-half performance of A$3.60 billion.
- The bank's CET1 ratio stood at a robust 12.5%, exceeding expectations, and is set to further improve by approximately 20 basis points following the announced sale of its RAMS mortgage portfolio.
- Westpac (WBC) will sell its A$21.4 billion RAMS mortgage portfolio to a consortium including Pepper Money (PPM), KKR, and PIMCO, with completion anticipated in the second half of 2026.
- A final dividend per share of A$0.77 was declared, alongside core and group net interest margins (NIM) excluding items of 1.81% and 1.94% respectively.
Westpac Banking Corporation (WBC) has announced its full-year 2025 financial results, reporting a net income of A$6.92 billion, marginally below the estimated A$6.93 billion. The second half of the fiscal year saw a net income of A$3.60 billion, slightly surpassing analyst projections of A$3.58 billion.
The Australian banking giant also revealed a strong Common Equity Tier 1 (CET1) ratio of 12.5%, exceeding the estimated 12.4%. This robust capital position is expected to strengthen further, with an anticipated rise of approximately 20 basis points following the completion of its RAMS mortgage portfolio sale.
In a significant strategic move, Westpac (WBC) confirmed the sale of its A$21.4 billion RAMS mortgage portfolio. The portfolio will be acquired by a consortium that includes non-bank lender Pepper Money (PPM), along with global investment firms KKR and PIMCO. This divestment aligns with Westpac's ongoing simplification strategy.
The transaction is expected to finalize in the second half of 2026. This sale marks a notable development in the Australian mortgage market, signaling continued consolidation and strategic adjustments among major lenders.
Further details from the earnings report indicate a core net interest margin (NIM) excluding significant items of 1.81%, while the group NIM excluding items stood at 1.94%. Shareholders will receive a final dividend per share of A$0.77.
The RAMS brand, acquired by Westpac in 2007, has faced challenges in recent years, including the closure of its franchise network in 2024 due to compliance failures and a A$20 million fine from the Federal Court for systemic breaches of the National Consumer Credit Protection Act. The sale to the consortium represents a strategic exit for Westpac from this non-core lending brand.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.