WBC - Westpac Banking Corporation

[Toulouse - Luzern]

I also received this notice of the class action.
I bought and sold at a loss in the relevant period.
I see there is no downside for ex Shareholders seeing how it plays out.
I see a good chance of success.
Not a legal opinion, but on a de Bono evaluation basis:
"White high level facts":
It seems Westpac did poorly at the Royal Commission.
As did all the banks.
IMHO many still think some action was called for against most or all of the banks based on the revelations at the Royal Commission.
For Westpac, inter alia, Risk management and money laundering management and reporting poor, exposing shareholders without the true facts to risk.
Westpac was fined AUD 1.3B subsequently.
Senior Executive went.
Westpac has already lost another Class Action re Insurance, in April 2021 with another firm of lawyers.
Competent lawyers with the current brief and 3rd party "insurance" funded on a no win no fee basis.

In Court in Victoria next on 21 October 2021

Make you own evaluation.

Caveat I have not seen the detail of the Plaintiff case.
The Westpac Defense response is on a numbered paragraph basis apparently referenced to the detailed Plaintiff Case points.
Without the two sides data side by side it is not possible to fully assess the validity of the Defence case.

Maybe someone else better qualified could access this and comment.

Thanks

Might be of interest to some. Wonder what the chance of success is ? Measured by $'s to investors.
https://phifinneymcdonald.com/projects/


WESTPAC SHAREHOLDER CLASS ACTION
Phi Finney McDonald acts for the representative applicant in a class action against ASX-listed Westpac Banking Corporation (Westpac) commenced in the Federal Court of Australia.

Registration

If you acquired Westpac securities between 16 December 2013 and 19 November 2019 (inclusive), please email westpac@pfm.law to register and obtain more information about the class action.

[Snoopy]

There have been quite a few business unit sales at Westpac since Covid-19 hit.

1/ Westpac have sold their lenders mortgage insurance business to Arch Capital (announced 18-03-2021, sale will be loss making with $84m goodwill write down).
2/ Westpac have paid $80m to get out of their relationship with ASX listed IOOF. IOOF is a wealth management and investment advice company that had a ten year deal to favour the Westpac owned BT panorama wealth management platform.
3/ Westpac have sold their pacific business unit (7th December 2020) Westpac Fiji and Westpac Papua New Guinea to Kina Bank (ASX:KSL). There will be an expected accounting loss on the sale of $230m.
4/ Westpac have sold their general insurance business to Allianz (announced 2nd December 2020). The sale price of $725m represents 1.3x FY2020 revenue.
5/ Westpac has disposed of their 10% stake of holding in Zip Holdings (ASX:Z1P). Zip supplies point of sale credit and digital payment services. Announced on 27-10-2020, at the share tender price of $6,65, this resulted in proceeds of $367m on a total investment cost of $48.9m.
6/ Westpac sold 'Vendor Finance' on 21-07-2020 to 'Angle Finance'. 'Vendor Finance' supports third parties selling small ticket equipment. The relatively small size of the loan portfolio ($500m) means this sale will have little effect on the Westpac balance sheet.
7/ Westpac on 18-06-2020 sold down their residual 9.5% stake in Pendal Group (formerly BT Investment Management). 31 million shares at a price of $5.98 per share means $185m was banked. This final sell down follows earlier sell downs in 2007, 2015 and 2017.

Still to be sold are the superannuation, wealth platforms and life insurance businesses. Auto finance is also tipped to be hocked off.

Westpac have grouped their businesses to be sold under the 'Specialist Business' division that made a cash loss of $506m in total over FY2020.

Progress Report:

3b/ 26-07-2021 Papua New Guinea’s Independent Consumer and Competition Commission (ICCC). The ICCC has released its draft determination indicating it proposes to deny authorisation to Kina Bank for the proposed acquisition of WSpecialistestpac's stake in Westpac Bank PNG Limited. Kina already has a banking presence in Papua New Guinea. So this proposed acquisition would remove one of only four players in that market.

6b/ 03-08-2021 Vendor Finance business sale to Angle Finance1, has completed. The sale has a negligible impact on Westpac’s balance sheet and capital ratios. A small accounting loss was recognised in FY20.

8/ 09-08-2021 Westpac today announced it has agreed with TAL Dai-ichi Life Australia Pty Limited (“TAL”) to sell 'Westpac Life Insurance Services Limited' and enter an exclusive 20-year strategic alliance for the provision of life insurance products to Westpac’s Australian customers. The sale price of $900m represents a multiple of 0.96x FY20 embedded value1. In addition, the transaction includes ongoing payments to Westpac. The transaction sees Westpac exit manufacturing life insurance products and releases significant capital back to the bank. The total accounting loss on sale is approximately $1.3 billion post-tax.

SNOOPY

[Waltzing]

Dont forget the new class action being filed by locals.

[Grimy]

Has anyone that has been notified they are part of the class action decided to opt-out?
I haven't as I don't see any downside to being in. But then I don't really know much about the pros and cons, or what realistically the chances of getting a result is (I guess there will be a result. One way or the other).
Basically I haven't given it much thought.

[dabsman]

A bit dissapointed with divvy but share buyback best way to go tax wise for me. Pretty profitable being a big bank

[Grimy]

Going by the share price drop there are plenty of people not happy. I would have preferred a larger dividend rather than the big buyback - even if not as tax effective - as it often seems that the NTA after a buyback is not always reflected in the share price going forward.
Possibly a top-up opportunity?

[dabsman]

Going by the share price drop there are plenty of people not happy. I would have preferred a larger dividend rather than the big buyback - even if not as tax effective - as it often seems that the NTA after a buyback is not always reflected in the share price going forward.
Possibly a top-up opportunity?

Yep I topped up. Got a bit at $25.40

[Grimy]

That'll teach me for being outside gardening!
Will see how the price goes tomorrow. Although I do have drain cleaning on the to do list in the morning.........

[dabsman]

That'll teach me for being outside gardening!
Will see how the price goes tomorrow. Although I do have drain cleaning on the to do list in the morning.........

WBC cleaned my drains today... like an enema

[Onion]

A bit dissapointed with divvy but share buyback best way to go tax wise for me. Pretty profitable being a big bank

Please correct my reasoning here if I've got things wrong - I don't currently understand the buy back offer.

To get a tax benefit you'll need to sell down over 15% of your holding (?).

Reading the info on NZ tax (section 2.5, page 20) it suggests that if you don't sell them more than 15% of your holding you need to treat the buy back as a dividend anyway. So I'm not sure of the tax advantage over a dividend.

To gain a tax advantage you would need to sell over 15% of you holding -- then presumably you can treat it (the non-dividend part?) as a capital gain (so not taxable unless you are trading the shares - "hold their Shares on revenue account").