Westpac Banking Corporation: Items impacting first-half 2026 results

The Westpac Banking Corporation (ASX: WBC) share price is in focus after the banking giant provided an update on items impacting its first-half 2026 results.

What did Westpac Banking Corporation report?

• Lending grew by 4% and deposit growth reached 3% during the half.
• Core net interest margin (NIM), excluding timing impact of rate rises, held steady in the second quarter of FY26.
• Ongoing productivity initiatives reduced expenses by 2%.
• Asset quality strengthened, and the CET1 capital ratio improved in 2Q26.
• Credit impairment charge was 10 basis points of average gross loans.
• Reported net profit after tax was reduced by $75 million due to transaction costs on the RAMS mortgage portfolio sale.

What else do investors need to know?

Westpac is navigating global uncertainty, with recent geopolitical tensions and energy market disruptions adding pressure. The bank noted that higher inflation and interest rates are expected to lead to a tougher environment for some customers.

Foreign currency movements—especially the 6% decline in the average New Zealand dollar exchange rate—had an impact on both revenue and costs. Westpac also increased provisions by adding a portfolio overlay for energy-intensive sectors, reflecting its cautious approach.

The sale of the RAMS mortgage portfolio is progressing, with completion expected in the second half of 2026. This transaction saw RAMS moved from the Consumer segment to Group Businesses in Westpac’s financial reporting.

What’s next for Westpac Banking Corporation?

Looking ahead, Westpac plans to focus on supporting customers during a period of ongoing economic and geopolitical change. The bank is also continuing to execute its productivity and efficiency drive while progressing its strategic portfolio reshaping, including the RAMS sale.

Westpac expects the challenging environment to persist but remains committed to maintaining strong asset quality and disciplined capital management through the upcoming half.

Westpac Banking Corporation share price snapshot

Over the past 12 months, Westpac shares have risen 40%, outperforming the S&P/ASX 200 Index (ASX: XJO) which has risen 15% over the same period.

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The post Westpac Banking Corporation: Items impacting first-half 2026 results appeared first on The Motley Fool Australia.

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