Westpac Margin Loan Frequently Asked Questions

If you are not an existing Westpac customer, we will need to identify you to meet our obligations under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006. This means you will need to provide us with acceptable forms of identification as outlined within the application form.

You will also need to provide us with certain details of your income and financial situation so we can conduct a comprehensive credit assessment. In addition, you will also need to provide us with certain documents to verify your income and liabilities. All these documents and requirements are outlined within the application form.

Note: This does not apply to the Westpac Margin Loan – Wholesale, with the specific requirements for that product outlined in the Westpac Margin Loan – Wholesale Application Form (PDF 1MB).

When applying for a margin loan, you specify what credit limit you would like to apply for. Every applicant is then assessed for the requested credit limit based on their financial position. This means the credit limit is the maximum balance that your loan can reach, regardless of your borrowing limit.

Your Borrowing Limit is the maximum Loan Balance allowed based on what investments you have provided as security. It is calculated by multiplying the Loan to value ratio (LVR) of each Acceptable Security by its current market value and as the market value of your investments changes daily so too will your Borrowing Limit.

If you would like to transfer shares held with another broker or issuer sponsored stock held directly with a share registry to your Westpac Margin Loan, complete the Share Transfer Request (PDF 719KB) and return it to us.

If you would like to lodge managed funds to your Facility, complete the Managed Funds Transfer Request (PDF 692KB). If lodging more than one managed fund, you will need to complete a separate form for each fund even if they are with the same fund manager.

Once lodged, they will be held in the name of our nominee company BT (Queensland) Pty. Ltd. as outlined in the Westpac Margin Lending Facility Agreement (PDF 418KB).

When your new Westpac Margin Loan is approved and activated, you will automatically be provided with access to the Westpac Margin Lending Portal to view and transact on your account online. If you have forgotten your username or password, call 1800 816 222 and we can provide you with your username or reset your password for you.

If you would like to buy and sell shares on your Westpac Margin Loan you will need a stockbroker to either place trades on your behalf or you can utilise the services of an online broker and place the trades yourself (if using an online broker, contact them first to confirm if they can settle trades to a Westpac Margin Loan account).

You may also link a Westpac Share Trading account using the Westpac Share Trading Change of Payment Options and Direct Debit/Direct Credit Request. This has the benefits of straight-through processing and the ability to view your facility position in real time via the Westpac Share Trading platform.

If you would like to purchase or redeem units in a managed fund investment, complete the Managed Funds Transaction Form (PDF 756KB). If making an initial managed fund investment, also complete the relevant managed fund application form for the fund and return it with the Managed Funds Transaction Form.

BPAY®.

Please allow for 2 working days for funds to be received by Westpac Margin Lending.

Biller Code: 17111
Customer Reference No.: Your six-digit reference number (refer to your statement)

Direct Credit.

You can transfer funds directly to your Westpac Margin Loan.

BSB: 262 755
Account No.: Your six-digit account number (refer to your statement)
Account Name: Westpac Margin Lending

To fix the interest rate on your facility, you will need to either complete a Request a Fixed Interest Rate form (PDF 743KB), or sign into your Westpac Margin Loan account and complete the ‘Fixed Rate Request’ form in the ‘Forms’ section.

If you would like to authorise someone to operate your Westpac Margin Loan on your behalf, you and the person you are authorising will need to complete the Authorised Representative form (PDF 770KB). Except for receiving a margin call (which will be directed to the margin call contact), an Authorised Representative can do anything you are able to do under your Westpac Margin Loan (including but not limited to increasing the loan, buying or selling investments and changing your contact details).

To notify us of a change to your contact details or to amend the name of a borrower or third-party security provider, you will need to complete a Contact Details Amendments form (PDF 701KB). If you change your name due to marriage, a certified copy of the marriage certificate will need to be provided. If you change your name for any other reason, relevant supporting legal documentation will be required.

Alternatively, you can sign into your Westpac Margin Loan account, go to the ‘Forms’ section and select ‘Client Details Change Request’.

If you would like to add a new linked bank account or amend an existing linked bank account on your Westpac Margin Loan you will need to complete the Direct Debit/Direct Credit Request (PDF 2MB). On this form you will need to specify if the nominated bank account is being used for debit or credit purposes (or both) or replacing your existing nominated bank account. You may also instruct us to debit the bank account for monthly interest payments, regular gearing contributions or regular debits.

If security is being provided that is owned by someone other than the borrower, they will need to complete a Third-Party Security Provider Application form (PDF 762KB). The security can be held in the name of an Individual, Company (except where acting as a trustee) or in the case of Joint Borrowers, where the security being provided is owned by one of the borrowers only. Once the Third Party has been set up on the account, they can transfer shares to us using the Share Transfer Request (PDF 719KB) or lodge managed funds by completing the Managed Funds Transfer Request (PDF 692KB).

You can apply to increase your credit limit by completing a Credit Limit Variation Request (PDF 790KB) and providing the required financial information and supporting documentation outlined on the form.

Note: Loans are subject to approval and require credit assessment. When you request a Credit Limit Increase, we will assess your financial situation to determine whether the Credit Limit is suitable for you.

Interest will either be charged at a variable or fixed rate:

Variable

Interest is calculated daily on the balance of your variable rate loan and charged monthly in arrears. Interest charges may be capitalised to your variable rate loan or direct debited from a nominated bank account. The variable interest rate is subject to change at any time. If you are capitalising your interest and would like to change to direct debit, you will be required to complete a Direct Debit/Direct Credit Request (PDF 2MB). If your interest is being direct debited and you would like to capitalise your interest, you can send us a signed written request instructing the change.

Fixed Rate

At any time, you may request for a portion of your variable rate Loan Balance to be transferred to a fixed rate loan. Our fixed interest rates are available for terms ranging from 3 months up to 5 years with the option for interest to be charged monthly in arrears or prepaid yearly in advance. Fixed interest charges may be capitalised to your variable rate loan or direct debited from a nominated bank account. The interest rate you will be charged will not change over the term of your fixed loan. On the expiry of your fixed rate loan, you will have the option to rollover the balance to a new fixed rate loan or allow the balance to be transferred back to your variable rate loan.

If a margin call occurs, you will be contacted either by email and/or SMS (as per the preferred contact method that you nominated), however it is important that you proactively monitor your loan position regularly.

As investment markets are by nature volatile, a Buffer is added to the LVR of each Acceptable Security to ensure small fluctuations in the market value of your investments do not result in a margin call. It is especially useful if you have borrowed up to the maximum permitted. The Buffer gives you time to take the appropriate actions to return your loan to a suitable security position and reduce your chance of a margin call.

The Buffer is based on a percentage of the market value of each investment held as security on your Westpac Margin Loan. The Buffer is currently set at 10% of the market value of each security, although we may change it at any time, including reducing it to zero.

When a margin call is made, you will be required to restore your loan back to your Borrowing Limit by doing one of the following by 2pm (Sydney time) on the following business day:

• Make a loan repayment to reduce your outstanding Loan Balance
• Transfer or lodge additional Acceptable Securities (held externally) into your Westpac Margin Loan to increase your Borrowing Limit
• Sell securities held on your Westpac Margin Loan to repay a portion of the loan

You may also clear your margin call by doing any combination of the above.

Note: If you are required to clear a margin call, you must restore your loan to the Borrowing Limit. Returning your loan back to within the Buffer will not be sufficient.

If you do not clear your margin call in full within the required timeframe, Westpac Margin Lending may sell some or all of the investments held as security to reduce the outstanding Loan Balance to your Borrowing Limit.

It is important that you closely monitor your facility on a regular basis and promptly act if you are in a margin call position. While we will attempt to contact you if you are in a margin call position, if we are unable to do so, we may sell shares or redeem managed fund units to restore your facility position without further reference to you.

To minimise the risk of a margin call, we recommend you consider:

• Depositing additional funds
• Providing additional acceptable investments as security
• Paying the interest monthly instead of having the interest added (capitalised) to your loan balance (for variable interest rate loans)
• Arrange for dividends and distributions to be credited directly to your variable rate loan
• Not borrow up to the maximum
• Diversify your portfolio across a number of investments and industry sectors to lessen the impact of poorly performing investments