News: WBC Westpac Banking Corp Seeks To Raise About $2.5 Bln In Capital

Nov 4 (Reuters) - Westpac Banking Corp (WBC) :

• SEEKING TO RAISE ABOUT $2.5 BILLION IN CAPITAL
• EXPECT AUSTRALIAN ECONOMY WILL LIFT SUPPORTED BY LOWER INTEREST RATES, IMPROVED HOUSING SENTIMENT AND TARGETED INCOME TAX CUTS
• EXPECT RECENT RECOVERY IN HOUSE PRICES, PARTICULARLY IN SYDNEY AND MELBOURNE, TO EXTEND INTO 2020
• CONTRACTION IN RESIDENTIAL CONSTRUCTION CYCLE WILL EXTEND WELL INTO 2020
• EXPECT $500 MILLION OF PRODUCTIVITY SAVINGS IN FY20
• EXPECT SYSTEM CREDIT GROWTH IN YEAR TO SEPTEMBER 2020 TO LIFT FROM 2.7% THIS YEAR TO 3%
• BUSINESS CREDIT GROWTH IS EXPECTED TO SLOW SOMEWHAT FROM 3.3% TO 3% IN YEAR TO SEPTEMBER 2020
• EXPECTS TO MAKE MINORITY EQUITY INVESTMENT IN UK-BASED CLOUD BANKING TECHNOLOGY PROVIDER, 10X FUTURE TECHNOLOGIES
• "FELT IT WAS NECESSARY TO BRING DIVIDEND PAYOUT RATIO TO MORE SUSTAINABLE MEDIUM-TERM RANGE GIVEN CAPITAL RAISING & LOWER RETURN ON EQUITY"
• CAPITAL RAISE, ON A PRO-FORMA BASIS, EXPECTED TO INCREASE 30 SEPT 2019 CET1 CAPITAL RATIO BY ABOUT 58 BPS
• "2019 HAS BEEN A DISAPPOINTING YEAR"
• ANTICIPATE INVESTMENT IN STRENGTHENING RISK & COMPLIANCE WILL SEE EXPENSES INCREASE IN 2020 & REMAIN HIGH IN 2021
• EXIT OF FINANCIAL PLANNING BUSINESS & WEALTH RESET EXPECTED TO REDUCE EXPENSES BY ABOUT $200M IN FY20
• AVERAGE LENDING EXPECTED TO BE RELATIVELY FLAT OVER FY20
• WEALTH MANAGEMENT AND INSURANCE INCOME LIKELY TO BE LOWER IN FY20