Westpac folds financial advice arm putting 900 jobs at risk
Australia's troubled Westpac Banking Corporation is expected to announce cuts of up to 900 full-time jobs as the bank seeks to cut losses stemming from its financial advice business.
Some of the firm's advisory business will be sold to Viridian Advisory for an as yet undisclosed sum. Westpac said it was "working through other solutions" for its remaining advice clients.
Westpac is the latest in a line of financial companies to withdraw from the advisory sector following a slew of scandals that have plagued the Australian financial sector over the past two years and which led to the Royal Commission launching an ongoing investigation into the operations of the "big four" Australian banks, of which Westpac is one.
In June last year, the Australian Securities and Investments Commissions (ASIC) launched proceedings in Sydney's Federal Court against Westpac in relation to alleged poor financial advice provided by one of its former financial planners.
In November last year, Westpac reported a flat full-year profit of A$8.07bn as customer compensation and legal costs reined in performance. The results showed steep declines in second-half profits in wealth management and retail banking.
Brian Hartzer, Westpac's CEO, said: "While these decisions are the right decisions for our customers and for the business, there are some great, hardworking people who are affected by this."
"We will be working very hard to find those people other opportunities in the group. We're a large company, we have a lot of natural turnover, there's always an opportunity to try and re-plug people in," he added.
The transfer of part of the business to Viridian Advisory is scheduled to be completed by 30 June.
