Company: WEBNF
Filing Date: 2025-02-18
Form Type: 6-K
Source: 0001104659-25-014446
Chunk: 2

Company: WESTPAC BANKING CORP
Filing Date: 2025-02-18
Form: 6-K
Chunk 2
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 savings and term deposits. Higher earnings on capital and hedged deposits partly offset these impacts;                         |

| · | Treasury and Markets income of 13 basis points; and |

| · | Notable Items from unrealised fair value losses related to economic hedges of term funding detracted 12 basis points. These items 
 reverse over time.                                                                                                                |

Net interest income decreased by 6% in 1Q25. Excluding
Notable Items net interest income increased 1% with average interest earning assets up 1% and a modest decline in net interest margin.

Non-interest income increased 12%. Excluding Notable
Items non-interest income increased 9%, reflecting higher financial markets revenue.

Expenses increased 1% with wage and salary growth
partly offset by seasonally lower investment spend. Annual wage rises apply from 1 January 2025 and UNITE investment is expected
to ramp up.

Impairment charges to average loans of 5 basis
points, up from 4 basis points, remain low and reflect continued resilience by customers.

Financial strength

The Group CET1 capital ratio was 11.9% as at December 31,
2024. The 62 basis point decline in the quarter reflected the 2H24 dividend payment and higher Risk Weighted Assets (“RWA”)
from loan growth and Interest Rate Risk in the Banking Book.

The Group quarterly average liquidity coverage
ratio was 131% and the net stable funding ratio was 113% for 1Q25.

Group credit impairment provisions were $5.1 billion
as at December 31, 2024. The ratio of collectively assessed provisions to credit RWA decreased slightly to 1.28% as at December 31,
2024.

1
Core net interest margin is calculated by excluding Notable Items and Treasury and Markets.

Financial summary 2

|                                           |     |      |   |     |                 |   |     | Excluding Notable Items |   |     |                 |
| $bn                                       |     | 1Q25 |   |     |      % movement 
 1Q25 - 2H24 qtr 
         average |   |     |                    1Q25 |   |     |      % movement 
 1Q25 - 2H24 qtr 
         average |
| Net interest income                       |     |  4.5 |   |     |              (6 | ) |     |                     4.8 |   |