The Westpac Banking Corp (ASX: WBC) share price will be one to watch on Monday.
This follows the release of the banking giantâs third quarter update this morning.
Westpac share price on watch following Q3 update
All eyes will be on the Westpac share price at the market open after Australiaâs oldest bank released an update on its capital, credit quality, and funding.
In respect to its capital, Westpacâs CET1 capital ratio stood at 10.75% at the end of June, which is down from 11.33% at the end of March. This reflects a dividend payment (45 basis points), higher risk-weighted assets (RWA) (42 basis points) and higher capital deductions.
The bankâs RWA were up $18 billion or 3.9% during the third quarter of FY 2022, mostly from higher interest rate risk in its banking book.
Credit quality remains strong
Potentially giving the Westpac share price a lift today is news that its credit quality remained strong during the third quarter.
The bank revealed that its provision cover was little changed, with total provisions to credit RWAs at 1.25%. This was down 5 basis points over the quarter.
Another positive was that Westpacâs stressed assets to total committed exposures (TCE) fell 4 basis points to 1.06%.
The bankâs mortgage 90+ day delinquencies also improved, falling 5 basis points to 0.83% in Australia and 2 basis points to 0.28% in New Zealand.
Strong funding and liquidity
Westpacâs funding and liquidity was strong with a Liquidity Coverage Ratio (LCR) of 130% and a Net Stable Funding Ratio (NSFR) of 123%.
In addition, the bank revealed that its deposit to loan ratio was 83.1%, down from 83.5% at the end of March.
No details were provided in respect to its profits, margins, or cost cutting during the quarter. Investors may have to wait until its full year results later this year for that unfortunately.
The post Westpac share price on watch following Q3 update appeared first on The Motley Fool Australia.
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More reading
- 5 things to watch on the ASX 200 on Monday
- Up 12% in 30 days, is the Westpac share price still a buy?
- Top ASX dividend shares to buy in August 2022
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- Analysts say these ASX dividend shares are top buys
Motley Fool contributor James Mickleboro has positions in Westpac Banking Corporation. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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