Westpac Benches NZ Demerger Ambitions
(24 June 2021 – New Zealand) Australia’s second largest Bank by market capitalisation has confirmed it will not proceed with the demerger of its New Zealand (NZ) operations.
Westpac has announced that it will be retaining full ownership of Westpac New Zealand Limited (WNZL), despite previously seeking to sell the company.
The Australian bank major has asserted it will not be proceeding with the demerger. The NZ division has been a part of the Westpac group for over 160 years, however the Big Four major had previously said that, given the changing capital requirements in New Zealand and the Reserve Bank of New Zealand (RBNZ) requirement to structurally separate Westpac’s NZ business operations from its operations in Australia, it was "appropriate to assess the best structure for these businesses going forward” the bank said.
The WNZL board stated that its priority now would be to finalise the appointment of a new CEO to replace David McLean following his imminent retirement. Simon Power, general manager institutional and business banking, will act as CEO.
“After a detailed review, we believe a demerger of the WNZL business would not be in the best interests of shareholders. Our review identified opportunities to improve service for customers and value across the WNZL business and we will progress these with the WNZL Board and management team” stated Westpac Group CEO Peter King.
“WNZL is a strong business that has been serving New Zealand for 160 years. We remain committed to delivering for customers and fulfilling our purpose of helping Australians and New Zealanders succeed” Mr King added.