Westpac in new $260m remediation provision

Westpac's first-half profit will take a $260 million hit as the lender sets aside yet more cash to remediate customers.

Westpac will set aside another $260 million to remediate customers.

Westpac will set aside another $260 million with its first-half results to remediate customers. (AAP)

Westpac is setting aside another $260 million for customer remediation, taking its total to $659 million with fees-for-no-service refunds yet to come.

The lender on Monday said about half the provision is related to financial advice and the remainder related to business and consumer banking.

The provision covers issues including interest-only loans that did not correctly switch to principal and interest, and incorrectly issued business loans.

"We are determined to fix these issues and stop these errors occurring again," chief executive Brian Hartzer said.

The provision will be recorded in Westpac's first-half results and follows $118 million set aside in the 2017 financial year and $281 million in 2018.

The bank said it is still trying to calculate fee-for-no-service refunds for customers of authorised advisers.

"We will continue to review our products and services to ensure they deliver the right outcomes for customers and, if necessary, make further provisions."

Westpac said it will assess provisions for authorised representatives as part of its first-half results, which are due on May 6.

At 1110 AEDT, Westpac shares were 1.5 per cent lower at $26.11, broadly in line with those of its major peers.


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Source: AAP


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