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Westpac outlines $282m cut to H1 earnings

·1-min read

Westpac says its first-half earnings due next week will be lower by $282 million, mostly due to compensating customers.

The bank on Monday outlined money being put aside for customer refunds and legal expenses of $220 million, along with write-downs of software ($115 million) and costs.

Some of the refunds relate to financial planners charging fees for no service.

The software write-downs were due to a policy change, which raised the threshold before a project could be capitalised from $1 million to $20 million.

There was a $84 million write-down of goodwill for Lenders Mortgage Insurance, which the bank is selling.

There was also an accounting loss on the sale of Westpac Pacific of $113 million, as well as $56 million in costs from ending a deal with financial services provider IOOF.

These items were partially offset by gains such as a revaluation of Westpac's investment in US cryptocurrency group Coinbase of $288 million.

Westpac also gained $18 million after it chose to sell its stake in buy now, pay later provider Zip.

The bank said it had already flagged $212 million of the $282 million in an earlier update.

The bank is due to report first-half earnings on May 3.

Shares were up by 0.48 per cent to $25.24 at 1437 AEST.