02 Dec 2020
The Australian bank regulator said on Tuesday it was forcing Westpac Banking Corp to raise its cash reserves after it fell short of prudential standards, its second enforcement action in a year against the country’s No. 3 lender.
The Australian Prudential Regulation Authority (APRA) said a review of the bank’s risk management found it incorrectly calculated several key capital ratios through 2019 and 2020, reflecting “weaknesses in risk management and oversight, risk control frameworks and risk culture.”
The breaches were since fixed, but APRA ordered the Sydney-based lender to add 10% to the amount of cash it keeps on hand until the bank completed an independent review of its risk management. Neither the regulator nor the bank put a dollar figure on the penalty.
The enforcement action draws Westpac back into the kind of regulatory intervention it hoped to put behind it when it agreed in September to a record A$1.3 billion ($955 million) settlement with the country’s financial crime watchdog over a 2019 lawsuit accusing it of enabling millions of improper payments, including to people exploiting children.
By Byron Kaye, Reuters, 1 December 2020
Read more at Reuters
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