Site menu

Search by ticker code:
Generic filters


Search by ticker code:
Generic filters

Search by ticker code:
Generic filters

Westpac (ASX:WBC) share price drops after technology update, costs

The Westpac Banking Corp (ASX: WBC) share price is down more than 1.5% after the ASX bank share gave a technology simplification update.

Focused on simplification

Westpac said it’s ready to accelerate its simplification, but this will come at a cost.

It’s focused on banking in Australia and New Zealand, after exiting 10 businesses.

The idea is that the technology foundations of the business will be simple and modern. It wants to have the number one mobile banking app.

Westpac also pointed to EFTPOS Air for business customers and AI-powered Westpac SaferPay to stop scams as technology upgrades.

There are a number of benefits that Westpac is hoping for.

A better customer experience is expected, with simplified customer journeys, with end-to-end digital experiences and faster to market.

It can lead to an improved employee experience, allowing staff to have more time with customers, better insights and it will enable innovation.

Finally, Westpac is hoping for an increased shareholder return, with improved operating cost efficiency, a reduced cost of charge and “improved risk”. This could help boost the Westpac share price if profit rises.

What will it take to deliver this?

There are a variety of different elements to this plan.

It’s taking the amount of banker platforms to assist customers from six to three. The amount of customer onboarding systems are going to reduce from 11 to one. The ‘collection systems’ are going to reduce from seven to one.

Westpac is expecting some elements of this plan to take until 2028 to complete.

The total annual investment spend is expected to be $1.8 billion in FY24 and then around $2 billion annually from FY25 to FY28.

This ‘UNITE’ project is going to be around 30% of total spending between FY24 to FY28, which suggests $0.6 billion per year.

Westpac is hoping UNITE will be a major driver to close the cost-to-income ratio gap to peers.

Final thoughts on the Westpac share price

Westpac is doing the right thing by making these changes. Banks need to operate with the best infrastructure they can for customers and their own operations.

I don’t think the Westpac share price is a buy after its 20% plus rise over the six months, it’s facing rising arrears, challenged margins and limited credit growth.

I think other ASX dividend shares are better ideas for long-term income and potential capital growth from here.

$50,000 per year in passive income from shares? Yes, please!

With interest rates UP, now could be one of the best times to start earning passive income from a portfolio. Imagine earning 4%, 5% — or more — in dividend passive income from the best shares, LICs, or ETFs… it’s like magic.

So how do the best investors do it?

Chief Investment Officer Owen Rask has just released his brand new passive income report. Owen has outlined 10 of his favourite ETFs and shares to watch, his rules for passive income investing, why he would buy ETFs before LICs and more.

You can INSTANTLY access Owen’s report for FREE by CLICKING HERE NOW and creating a 100% FREE Rask Account.

(Psst. By creating a free Rask account, you’ll also get access to 15+ online courses, 1,000+ podcasts, invites to events, a weekly value investing newsletter and more!)

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

At the time of publishing, Jaz does not have a financial or commercial interest in any of the companies mentioned.
Skip to content