Westpac share price: where to next after $1.5 million fine from APRA
Here’s everything you need to know about the $1.5 million infringement penalty APRA has just handed down to banking giant Westpac.
On Thursday, APRA, the prudential regulator of Australian financial service companies, announced that it had served banking giant Westpac Banking Corp and two of its associated entities with infringement notices carrying penalties totalling A$1.5 million.
What did Westpac do, exactly?
According to the regulator, Westpac Banking Corp was as much as 20 days late in submitting key financial reports to APRA’s offices, for the 2019 March month.
In addition to this, two of Westpac’s subsidiaries: St George Finance Holdings and Capital Finance Australia, submitted their filings even later, coming in 37 days overdue.
Westpac’s subsidiaries were also late in submitting their filings for the 2019 April month.
The prudential regulator noted that a failure to submit these filings in a timely manner carried with it strict liabilities.
Indeed, that was the case when APRA issued infringement notices to Westpac and its subsidiaries, carrying a total penalty of A$1,501,500.
This is the maximum financial penalty APRA has the capacity to issue, for matters of this kind.
APRA’s Deputy Chair weighs in
In response to the A$1.5m fine, APRA’s Deputy Chair, John Lonsdale, commented that:
‘Access to accurate and timely data is critical for APRA to monitor effectively the safety and stability of the banking, insurance and superannuation sectors.’
Mr Lonsdale further stressed that:
‘By issuing these infringement notices, APRA wants to send a strong message to industry that compliance with our reporting standards is mandatory, and cannot be considered secondary to other business priorities.’
Westpac share price: how did investors respond?
Unsurprisingly, investors seemed unworried by news of APRA’s A$1.5m fine.
In fact, as of 13:24 AEST, Westpac traded almost half a percent higher at A$28.18 per share.
In the scheme of things and when compared to the impact of the Hayne Royal Commission, a A$1.5m fine represents little more than a slap on the wrist for the A$99.8 billion Westpac.
Indeed, with cash earnings of A$3.2bn in the first-half of 2019 alone, APRA’s fine is likely to have little long, or for that matter, short-term impact on the bank.
According to the APRA website, Westpac has until September 6 to pay the $1.5m fine.
Westpac Banking Corp has yet to release an official statement on the matter.
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