Media releases
Opening Statement by Westpac CEO Peter King: House of Representatives Standing Committee on Economics
29 August 2024
Today I’ll provide an update on three key areas: the outlook for the Australian economy, how customers are managing cost of living challenges, and the significant steps we're taking to battle scams.
From a macro perspective, the Australian economy is proving resilient compared to global peers, just as it did during COVID. Australia’s key economic indicators remain stable. While we’ve seen low economic growth and slightly higher unemployment, this performance should be viewed in the context of global conditions, which are more challenging.
Westpac’s view is the Australian economy is well placed for a return to higher levels of growth when pressures ease, and our economics team expect interest rates to start coming down early next year. Looking at the next cycle, the forecast is that the cash rate will settle in the low 3% range, all else being equal.
From our perspective, Westpac is well positioned to support the economy. Whether customers are seeking some assistance with cost of living challenges, or if businesses are looking to grow, we’re here and ready to help.
The resilience of the economy is mirrored in our customer base. As an example, total loan stress has increased to 1.4% but is lower than expected, while more than 78% of mortgage customers are ahead on their repayments.
Despite this, we recognise many Australian households are making difficult spending choices to balance their budgets. Currently, around 19,000 customers are in hardship arrangements. For context, we have more than 3.1 million customers with a debt product – so this represents about 0.6% of customers we lend to, in hardship.
We are also taking additional steps to help all Westpac customers.
Last September, we launched new tools in our banking app to help customers track and manage their expenses, as well as find potential savings. More than half a million customers are using these features each month.
In May, we launched push alerts to help customers earn bonus interest on their savings. So far, more than 150,000 customers have acted on these alerts.
Finally, we continue to focus our efforts on making Australia a hard target for scammers. I hate seeing this crime in our country and I would like to recognise the collective efforts of the Australian Government, regulators, banks and telcos who are working together in this fight on scams.
Over the past two years, Westpac has invested more than $100 million in scam prevention measures. We are seeing good results, with customer scam losses down over 30 per cent year on year.
In particular, the decision to block transactions to some digital currency exchanges has been a major contributor to bringing down these losses.
We have also delivered three significant technology upgrades to strengthen scam defences in the last 12 months:
- Westpac Verify is our version of Confirmation of Payee. This lets customers know if the name and account details match in payments before any money is sent.
- Second is Westpac SaferPay. This presents customers with questions for payments we think have a high scam risk – for example, if someone is buying so-called investment bonds online; and
- Third, we are piloting Westpac SafeCall. This is an Australian-first and gives our customers a verification to prove Westpac is calling them, and not a scammer.
Investment scams continue to present the greatest challenge, accounting for around 50 per cent of all customer losses. Too often, Australians are getting their investment advice from ads they’re finding online including on Meta platforms.
Unfortunately, digital platforms and social media companies are still missing in action when it comes to the fight against scams. The Australian Financial Crimes Exchange estimates that 40% of all scams originate from these platforms. What’s most shocking, is that these companies are profiting from illegal ads targeting Australians. These companies need to act. If they do not, the Government should move decisively and quickly to regulate them.
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