# Westpac Reports $6.8 Billion Profit Amid Housing Market Decline Forecasts Australia's oldest bank predicts an 11 percent house price drop while maintaining resilience. - **Source:** [Sydney Morning Herald - Latest News](https://www.smh.com.au/rss/feed.xml) - **Published:** 2026-11-01 - **Topic:** [Finance](https://brifing.si/c/finance) - **Original article:** - **On Brifing:** https://brifing.si/s/d0c10115-9b6a-496e-b8d0-39bb95fe0997 ## Annual Profit Performance Westpac reported a $6.8 billion profit for the fiscal year ending in September, marking a 1 percent decrease from the previous year. Despite this slight decline, the bank maintained stability through strong business and institutional lending growth, which rose by 12 percent and 18 percent respectively during the reporting period. ## Housing Market Outlook The bank projects a significant 11 percent decline in national house prices by March 2027. This forecast follows a 5.2 percent drop from the peak observed in March. Westpac anticipates that interest rates will remain elevated until 2027, creating ongoing challenges for households and businesses across the broader Australian economy. ## Net Interest Margin Pressures Westpac’s net interest margin, a critical profitability metric, fell by 3 percentage points to 1.86 percent during the second half of 2026. This contraction resulted from intense lending competition and a higher volume of customer accounts qualifying for savings bonus rates, which offset gains made in other core banking segments. ## Customer Repayment Resilience Despite rising cost of living pressures, mortgage hardship remains low at 0.6 percent. Approximately 86 percent of customers are currently ahead on their mortgage repayments, with nearly four in ten borrowers remaining two years ahead of schedule. Only 1 percent of the bank's total customer base is currently behind on payments. ## Hardship Support Initiatives Over the past year, Westpac provided more than 42,000 tailored financial hardship and disaster relief packages to its customers. Notably, over 60 percent of these assisted individuals required support for less than three months, suggesting that many borrowers are successfully navigating temporary financial difficulties without needing long-term intervention from the bank. ## Credit Impairment Provisions The bank increased its credit impairment provisions to $5.2 billion to account for potential loan losses. Management cited economic and geopolitical uncertainty as primary drivers for this conservative approach, specifically noting risks affecting energy-intensive sectors and a general slowdown in discretionary consumer spending across the wider Australian national market. ## Dividend Payout Strategy Westpac will distribute a final dividend of 77 cents per share to its shareholders. This brings the total full-year dividend to $1.54, reflecting a 1 percent increase compared to the previous year. This payout demonstrates the bank's commitment to returning capital to investors despite the challenging macroeconomic environment and interest rate volatility. ## Strategic Economic Context While the Australian economy holds up relatively well due to robust business investment, price growth remains above the Reserve Bank’s target. With the RBA expected to raise interest rates for the fifth time this year, Westpac’s focus remains on maintaining credit quality while balancing the impacts of a cooling housing market. ## Sources covering this story - https://www.smh.com.au/business/banking-and-finance/westpac-expects-11-per-cent-house-price-fall-posts-6-8-billion-profit-20261102-p61ah6.html?ref=rss&utm_medium=rss&utm_source=rss_feed — --- _Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._