Westpac Banking Corporation unaudited FY2015 results and entitlements offer

Westpac has today announced its unaudited preliminary final results for the year to 30 September 2015: cash earnings of $7.82 bn are up 3% on the pcp (FY2014: $7.628 bn) with statutory NPAT of $8.012 bn up 6% on the pcp. Cash earnings momentum is usually good for short term incentive schemes. While cash earnings excludes the accelerated amortised IT expenses of $354 million, it also excludes the $665 million profit on the partial sale and de-consolidation of BTIM. Of course the background for this announcement is the $3.5 billion entitlements offer, a pro-rated accelerated renounceable entitlements offer. The capital raising is in response to a need to respond to changes in risk mortgage rates and the amount of capital required to be held against this risk. Note the announcement indicates those requirements don't apply until 1 July 2016. Today's announcement of the capital raising indicates Westpac has decided to increase its variable home loan rates for both owner-occupiers and residential investment properties by 20 bps from 20 November 2015.