Westpac Q3 2026 slides: steady growth masks looming margin pressure
Westpac Banking Corporation reported a modest 2% increase in net profit excluding notable items, reaching $1.8 billion for Q3 2026. The bank's net interest margin remained steady at 189 basis points, but analysts anticipate growing pressure in the future. Despite this, Westpac demonstrated impressive credit quality metrics, with total provisions for expected credit losses at $5.3 billion, indicating a conservative approach to risk management.
The bank's balance sheet expanded, with gross loans increasing 7% year-over-year to $908 billion and customer deposits growing 7% to $759 billion. However, the Australian mortgage market showed signs of cooling, with application volumes declining 11% in the quarter. Westpac's Common Equity Tier 1 capital ratio slipped to 12.1% due to dividend payments and lending growth.
Despite these challenges, the bank's overall performance remained solid, reflecting steady growth that masked potential margin concerns.
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