‘A great ride’: Evans on 30 years as Westpac’s top economics forecaster

Josh Wall
and
Michael Bennet
02:41pm September 24 2021

Bill Evans reflects on the key events during his 30 years as Westpac’s chief economist. (Josh Wall)

Bill Evans has done countless presentations over his 40-odd years in financial markets. 

But a few stand out during some of the biggest events the nation has seen, from the early 1990s recession to the global financial crisis and the COVID-19 pandemic. 

“I was on a marketing trip in the Northern Territory and I was meeting with the Chief Minister… (who) told us how that part of Australia was critically aligned with Indonesia and Asia,” Evans, Westpac’s long-time chief economist, recalls of the late 1990s Asian crisis. 

“That night I spoke at a dinner which was on the on the lawn of the MGM Grand Casino – beautiful weather in Darwin in August, and it was always going to be a tough gig talking to a group of people that are out on the lawn, plenty of beers, plenty of drink running. 

“So, I started to talk and … I thought I'd fire my big bullet, which was to say, ‘hey, I know how exposed you are to Indonesia. There's going to be a massive crash, there's going to be a crisis’. 

“And I still didn't get any response. So, I decided I should sit down and enjoy the party.” 

Fast forward to the mid-2000s and Evans was again on the road, this time in the US as the country’s housing and financial markets were on a tear. While his audience, someone “close” to then Federal Reserve Chairman Alan Greenspan, was far more attentive than those on the lawn in Darwin several years earlier, Evans’s concerns again failed to raise alarms despite proving prescient.   

“I remember telling him that I was starting to get worried about the booming housing market in the US. And I was telling him the experiences that Australia had had with booming housing markets and how they can bust and generate some problems for the economy,” he says. 

“And he glared back at me and he said, ‘Mr Evans, you don't understand the US. We've never had a housing bubble that's burst right across the country’. 

“But of course, that's exactly what happened, and it … laid the foundations – along with the extraordinary financial engineering that was going on – for the GFC.” 

William Evans first set foot in the door at Westpac in 1991, taking on the key chief economist role at a critical time for the nation.  

The “recession we had to have” had taken hold and Westpac was heavily exposed through its sizeable commercial property book. But that didn’t deter Evans, who’d previously had stints at The Reserve Bank and Schroders, then one of the main investment banks in the market. 

“It was time to take on another challenge,” he says 30 years on, adding the bank’s different culture to investment banking was one of his earliest memories. “I thought it was going to be a short-term appointment while the recession was on. Thirty years later, I haven't regretted a minute of it.” 

Over three decades at Westpac, Evans has become renowned as one of the nation’s most respected economists. His forecasts on the RBA’s cash rate, in particular, are closely watched after several correct big calls. 

Curt Zuber, Westpac’s former long-time treasurer, describes Evans as a “giant in the finance and banking world”. “A remarkable economist who can relate to the titans of business…while relating to the battler in the bush over a cold beer or red wine,” he says. 

Evans admits to making bad and good calls over the years and the stress it takes, but adds that “sometimes you have to say what you think the right policy is rather than what you think is going to go around the table”. His anti-consensus call in 2011 that the RBA would cut the cash rate 100 basis points stands out, with Evans revealing that a key driver was a trip to Europe that left the lingering feeling that the “world was a long way from recovery”. 

“We really did create a stir around the market,” he recalls. 

“We were the only voice making that argument, and indeed it turned out to be correct. So, that has to stand out. But there have been quite a few others where we've I feel that we've been able to provide our customers with very good advice.” 

Evans has been as vocal as ever through COVID, which last year caused the biggest downturn since the 1930s, followed by the quickest recovery. Most recently, he advocated for the RBA to expand its bond-buying program to assist the economy through the lockdowns in the NSW, Victoria and the ACT, which he expects will result in the economy contracting 4 per cent in the current September quarter. Today, he called on the Treasurer and the RBA to adjust the inflation target of 2-3 per cent to 1-3 per cent given the “structural changes in the Australian economy”. 

Prior to today’s note, Evans said the key changes in the economy in the past 30 years have been the flattening of inflation – and, in turn, very low interest rates – plus the massive lift in household debt and high house prices.

Moving forward, he says Australia faced similar challenges to other developed countries, namely very low productivity, climate change and high household debt. “It's about business investment, it's about good policy, it's about deregulating and making it easier for business and for households to move forward,” he says. 

And how long will Evans be around to assess and advise on these issues? 

“I've been privileged to have an incredibly interesting job…and I guess I've been fortunate to have been able to promulgate the job well,” he says. 

“And it's been it's been a great ride. I've enjoyed it and I hope there's a bit more of a ride left in me.”
 

Josh Wall

Josh Wall is the Head of Video at Westpac Wire. Prior to joining the team, he spent 10 years as a video journalist and documentary filmmaker, most recently as Head of Video for the Guardian Australia. He also worked across numerous News Corp mastheads in Sydney as a presenter, producer, writer and video journalist. Josh is originally from Perth, Western Australia where he began his career by co-creating a video magazine that focused on music and the arts.

Michael Bennet

Michael Bennet was inaugural Editor of Westpac Wire from June 2017 to December 2021. He joined Westpac after more than 12 years in journalism, most recently at The Australian as the national newspaper’s banking reporter based in Sydney. Michael has worked at various News Corp publications and other media companies covering industries including financial services, resources, industrials, markets and economics. He is originally from Perth, Western Australia, where he also wrote across magazines covering the arts with a focus on music.

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