Australian banking major Westpac has decided to shutter banking operations from major Asian markets including China and India following the review of its international operations.
The lender, which is grappling with capital constraints in the wake of the COVID-19 pandemic, will now shift its focus on its core domestic and New Zealand businesses.
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By GlobalDataThe bank in its press statement said that it will exit operations in Beijing, Shanghai, Hong Kong, Mumbai, and Jakarta.
The bank will now consolidate its international operations into branches in Singapore, London, and New York.
Westpac Institutional Bank (WIB) acting CEO Curt Zuber said: “Westpac’s priority is to focus on its core Australian and New Zealand customers and to support them in areas where we have scale and capability.
“To support this, WIB will be focusing our international footprint in three critical locations and streamlining the product set and customers we support outside Australia and New Zealand.
“For WIB, the change will enable us to deliver products and services to customers more efficiently. Our ambition is to be the leading Australian and New Zealand-focused institutional bank for customers while delivering sustainable returns.”
Citing people familiar with the development, Reuters reported that the decision to retreat from these markets may impact up to 200 jobs, mostly in Shanghai and Hong Kong.
Job cuts will be carried out in phases and may take up to 24 months to complete, the report added.
Westpac is said to have one of the weakest capital positions among the four major banks in Australia.
Westpac, which recently agreed to pay an AML fine of A$1.3bn ($916m), noted that the changes will not affect its cash earnings materially instead will help enhance capital efficiency by slashing its risk-weighted assets by over A$5bn ($3.6bn).
