Westpac Profit Edges Higher as Mortgage Demand Cools
Direct answer
Westpac, one of Australia’s biggest banks, made a slightly larger profit in its full financial year, even though fewer people applied for home loans late in the year. Profit excluding notable items rose to A$6.99 billion for the year ended September 30, 2026, up from A$6.97 billion a year earlier. That result matched market expectations.
What happened
Reuters reported on November 2, 2026 that Westpac’s deposits grew 6% and its loans grew 5% during the year. Australian housing loans, excluding its RAMS portfolio, rose 7%, and business lending rose 12%, with institutional lending up 18%.
The softer part of the result was new mortgage demand. Average monthly mortgage applications fell 15% in the fourth quarter compared with the same period last year. Westpac linked weaker housing and investor credit demand to the government scrapping tax concessions for property investors earlier in the year.
Westpac declared a final dividend of 77 Australian cents per share, the same as last year. Its core net interest margin, the gap between what it earns on loans and what it pays for funding, slipped 5 basis points to 1.76%. Its common equity tier 1 ratio, a key safety buffer, eased 7 basis points to 12.46%.
A separate company announcement summary confirmed the same headline figures, with statutory net profit of A$6.8 billion, down 1%, and profit excluding notable items broadly flat at A$7.0 billion.
Why it matters for beginners
A bank result like this tells two stories at once. The first is about the bank itself: steady profit, growing loans and deposits, and a dividend held steady. The second is about households: fewer mortgage applications can signal that higher borrowing costs or changed tax rules are cooling demand for new home loans.
For beginners, the key lesson is simple. A bank can still grow its existing loan book while new applications slow down, because loans already on the books keep earning interest. The mortgage application number is a forward looking signal, while profit is a backward looking result.
What to watch next
Watch the Reserve Bank of Australia rate decision on November 3, 2026, since a further rate rise could affect mortgage costs and demand again. Also watch Westpac’s next update on mortgage applications, and whether business lending keeps growing fast enough to offset softer home loan demand.
FAQ
What is Westpac?
Westpac is one of Australia’s largest banks, offering consumer, business and institutional banking, lending, deposits and payments services.
What does profit excluding notable items mean?
It is profit after removing one off items, so readers can compare the underlying result with the previous year more cleanly.
Does a 15% fall in mortgage applications mean Westpac is in trouble?
No, not on this result alone. Profit was steady, deposits and loans grew, and the bank kept its final dividend unchanged. The fall is a warning sign about demand, not a loss.
What should beginners watch next?
The Reserve Bank of Australia decision, mortgage rates, and the next mortgage application update, since those will show whether the slowdown continues or eases.
