...corporate culling has begun in earnest. Westpac readies the axe for its biggest redundancy round in years James EyersSenior Reporter
May 20, 2025 – 8.00pm
Westpac is preparing to cut more than 1500 employees in the bank’s biggest redundancy round in a decade as its new chief executive, Anthony Miller, pushes to meet ambitious cost reduction targets and transform the business by simplifying its processes and technology under a plan known as Unite.
Miller took the top job in December and has already made significant changes to the executive team. He has also revealed smaller margins as Westpac pushes into the competitive business-lending market, leading to first-half results that disappointed investors earlier this month.
Now, Miller has reset expectations for cost-cutting within the bank by asking managers to consider how they will reduce the number of employees by 5 per cent across most teams within the next few months, according to two people not authorised to discuss the briefings publicly.
The final number of staff exits has not been decided, a spokesman for the bank said, while confirming some redundancies were being contemplated.
“We adjust the composition of our workforce according to our investment priorities,” he said. “While we continue to invest in extra bankers and customer-facing roles, other programs and initiatives may need fewer resources. This means, from time to time, we make changes that may impact some roles and responsibilities. As the skills and capabilities required in banking continue to evolve, so will our workforce. We try to keep as many employees as we can, through retraining and redeployment.”
Based on Westpac’s last publicly available full-time head count, a 5 per cent reduction in the number of employees would mean 1700 staff will leave. That is on top of around 900 full-time roles cut in the last financial year.
However, it is not one-way traffic. At a lunch attended by fund managers a fortnight ago, Miller told investors he wanted to hire 180 more home finance managers while lifting pay for mortgage bankers. He said Commonwealth Bank and National Australia Bank were also hiring aggressively, as they shifted more home loan lending into in-house channels. Miller is also keen to hire more business bankers, a key area of growth.
At its interim results this month, Westpac said staff costs had grown 5 per cent half-on-half; the looming job cuts will help to offset this, after Miller, a former Goldman Sachs banker, set a cost-to-income target to be below its major bank peers by 2029. Some analysts described this as ambitious, given Westpac has run the highest cost ratio among major banks for years.
People briefed on the redundancy discussions said Miller would not be cutting staff working on the Unite program, a flagship program that aims to reduce the long-term cost base of the bank by deploying more nimble technology. However, they added, the additional cuts reflected Miller’s push to deliver cost savings even as Unite was rolled out and as margins were hit.
Bank margins will come under more pressure after the Reserve Bank of Australia cut the cash rate again on Tuesday. Westpac’s staff expenses in the last financial year were $5.9 billion, down from $6.1 billion in 2023. Staff comprising 55 per cent of the total expense base of the bank.
The latest figures published by Westpac show it had 35,240 full-time employees last year, down 906 people on 2023 and down 2236 on 2022. Temporary staff have been cut more aggressively than permanent employees.
Westpac’s share price fell for four consecutive days after it reported its results on May 5, as investors worried about the outlook for costs. The stock has recovered some of the losses this week but CBA and NAB have performed stronger, putting Miller under pressure after Westpac pointed to a net interest margin squeeze in the business banking, reflecting a combination of slow deposit growth and rising competition.
Citi analyst Thomas Strong said this week Westpac’s 5 per cent business lending growth, but negative net interest income, was a problem. “This presents as a cautionary tale to other banks pivoting into business banking, but also those defending share,” he said.
“The sector delivered negligible revenue [over the last half], as volume growth was mitigated by funding cost pressures pre-rate cuts, as well as strong competition. Costs and investment continue to rise, and credit quality continues to slowly deteriorate.”
Morgan Stanley analyst Richard Wiles said Westpac’s mortgage growth would remain below the average of its rivals, as its RAMS portfolio ran off. He raised red flags this week about Westpac’s overreliance on brokers, with proprietary channels accounting for just 33 per cent of flows in the first half, down from 46 per cent two years ago.
In additional to headcount, Miller looking for other ways to cut costs including merging part of the St George business into Westpac under a codenamed Project Aries. The St George’s branch network has been cut and Westpac has taken over cash services for St George.
CBA has also been reducing head count this month, albeit at a slower rate. The Finance Sector Union said on Monday more than 100 jobs had been cut since CBA’s quarterly report last week, with the bank telling workers it will cut 163 jobs. The union said this brings the total jobs cut across CBA and Bankwest in the last 12 months to almost 800.
