Westpac Banking Corporation Research Articles

Basel Capital Adequacy Agreements and Bank Risk: Some Australian Evidence

This paper examines the impact of the Basel agreements (Basel I introduced in 1988, Basel I with market risk in 1998 and Basel II in 2008), on the level of systematic risk of the Australian big four banks. An augmented market model with three dummy variables is employed to capture any changes in systematic risk after each agreement was introduced. We contribute to the strand of literature on the effectiveness of the Basel agreements by providing evidence consistent with the view that the Basel agreements did not help to control bank risk, but instead increased it. In particular, we find that bank risk increased after Basel I and Basel II. Basel I with market risk partially achieved its goal with the Westpac Banking Corporation and Australia and New Zealand Banking Group Limited showing decreased risk while the National Australia Bank and Commonwealth Bank of Australia had no change.

Engliish

Auditing standards require an auditor to make various enquiries about liabilities in general this may entail consideration of potential litigations and claims that the audited entity may be facing. To perform this part of audit, the auditors will generally seek representation letters from lawyers of the company detailing an estimate prepared by management, confirmed by their lawyers through a representation letter, and then sent directly to the auditors. This paper reviews the implications for the auditing profession of a case that involved auditors seeking such representation letters. The case involves litigation between the Westpac Banking Corporation and 789TEN Pty Ltd. While the Westpac case confirmed the legal position of the auditor in their task of collecting evidence in order to form an opinion in Australia, it highlights a significant anomaly under the law and should place the issue of solicitor’s representation letters as audit evidence firmly on the agenda of policymakers. This issue of the compromise of legal privilege during the conduct of an audit is also not confined to Australia: other common law jurisdictions, such as the UK and the US, have also sought to clarify the position of auditors when issues of the integrity of legal privacy privilege arise.

The relationship between exchange rates, interest rates and Australian bank returns

Although there has been significant research on US financial intermediaries' stock returns and sensitivity to interest yields, there has only been limited research on Australian bank stock returns and key macro variables, such as interest rates and exchange rates. The aim of this article is to examine this relationship for four major Australian banks, namely the Australia New Zealand bank (ANZ), the Commonwealth Bank of Australia (CBA), the National Australia Bank (NAB) and the Westpac Banking Corporation (WBC). We use the EGARCH model and examine the relationship using monthly data covering the period 1992 to 2007. The results suggest that for all four banks: (1) there is a similar and statistically significant negative relationship between interest rates and stock returns; and (2) there is evidence of an increase in returns during the period of appreciation of the Australian dollar.

The impact of the global financial crisis on competition policy in the Australian banking sector

This article explores how the current crisis is likely to affect competition policy, in particular merger reviews in the Australian banking sector. This article also considers how and why the global financial crisis happened and the extent to which deregulation and globalisation, in opening up the financial markets to competition, may have fuelled the crisis. It also provides an overview of the laws and policies that play a part in regulating bank mergers in Australia. In particular, the article focuses on the way in which bank mergers are treated under the Trade Practices Act 1974. In Australia, bank mergers are subject to assessment by the Australian Competition and Consumer Commission (ACCC) under the Trade Practices Act. The Federal Treasurer also has powers under the Banking Act 1959 to review, and if necessary, to prevent mergers between banks. In 2008, two significant bank mergers were allowed: Westpac Banking Corporation and The St GeorgeBank Limited and Commonwealth Bank of Australia and BankWest and St Andrew's Australia. Both mergers took place in the context of one of history's worst financial crises, raising concerns about whether the Australian banking sector will see a shift in merger law and policy such that the importance of preserving financial stability will come at the cost of competition. The article also considers the possible future impact of the global financial crisis, including the impact of “rescue packages”, on competition between banks in Australia – and whether these “bailouts” make good economic sense or are likely to threaten competition between banks.

In pursuit of a sustainable supply chain: insights from Westpac Banking Corporation

PurposeThe aim of this paper is to provide clues to industry and academia on how best to approach the challenge of developing a sustainable supply chain.Design/methodology/approachA case study was undertaken of the Westpac Banking Corporation – one of the world's most socially responsible banks – to examine how they approached the challenge of managing corporate social responsibility (CSR) in their supply chain.FindingsThis paper highlights some of the challenges and opportunities associated with extending corporate governance beyond the firm boundary. Specific attention is given to a discussion of assessment and governance tools.Research limitations/implicationsThe use of a single case study limits the generalizability of these findings. Future research can build on these findings by extending the scope to include additional firms, regions and methods.Practical implicationsA best practice model is developed from the discussion to provide practical guidance to firms.Originality/valueWhile the extension of CSR to the supply chain is an emerging area of interest, the literature provides few clues on how best to pursue sustainable supply chain management. This paper provides a valuable and timely contribution to this topic by reviewing the lessons and practices of a recognised CSR leader.

A modified logit model for time series with an application to the pricing behaviour of manufacturing firms in Australia

The modified logit model (Amemiya and Nold, 1975) is generalised to the case where the error term is autocorrelated. The asymptotic distribution (as n →∞ and T →∞) of a feasible GLS estimator of β is derived. Tests of linear restrictions on β and the significance of ρ are presented. The results of the applied work suggest that the factors which explain the pricing behaviour of manufacturing firms, as reported in the tendency survey conducted by the Australian Chamber of Commerce and Industry and the Westpac Banking Corporation, include historical inflation rates of up to 7 quarters and capacity utilisation.

AUSTRALIAN INVESTMENT INCOME TAXATION: THE WORST OF ALL WORLDS?

Economic Papers: A journal of applied economics and policyVolume 18, Issue 2 p. 49-60 AUSTRALIAN INVESTMENT INCOME TAXATION: THE WORST OF ALL WORLDS? CHARLES LITTRELL, CHARLES LITTRELL Australian Graduate School of Management and Westpac Banking Corporation. Much of the material in this paper is extracted from research undertaken while a student at the University of Sydney. Special thanks are due to Elizabeth Savage and Mark Robertson.Search for more papers by this author CHARLES LITTRELL, CHARLES LITTRELL Australian Graduate School of Management and Westpac Banking Corporation. Much of the material in this paper is extracted from research undertaken while a student at the University of Sydney. Special thanks are due to Elizabeth Savage and Mark Robertson.Search for more papers by this author First published: 13 April 2010 https://doi.org/10.1111/j.1759-3441.1999.tb00932.xCitations: 1 AboutPDF ToolsRequest permissionExport citationAdd to favoritesTrack citation ShareShare Give accessShare full text accessShare full-text accessPlease review our Terms and Conditions of Use and check box below to share full-text version of article.I have read and accept the Wiley Online Library Terms and Conditions of UseShareable LinkUse the link below to share a full-text version of this article with your friends and colleagues. Learn more.Copy URL Share a linkShare onFacebookTwitterLinkedInRedditWechat Citing Literature Volume18, Issue2June 1999Pages 49-60 RelatedInformation

Australian Federation of Islamic Councils Inc. v. Westpac Banking Corporation

405Diplomatic relations — Immunity — Proceedings in which diplomatic agent is a necessary and proper party — Proceedings relating to acts performed by diplomatic agent in official capacity — Whether joinder of diplomatic agent as party infringes diplomatic immunity and immunity of the foreign State — Proceedings relating to funds donated by Saudi Arabia on condition that control of funds exercised jointly by ambassador and recipient of donation — Whether ambassador a necessary and proper party — Whether court bound to stay proceedings — Common law — Australian Diplomatic Privileges and Immunities Act 1967, Article 31State immunity — Jurisdictional immunity — State agent — Funds donated by ambassador on behalf of Kingdom of Saudi Arabia on condition that control of funds exercised jointly by ambassador and recipient of donation — Whether ambassador a necessary and proper party to proceedings — Whether joinder as party in proceedings would have effect of impleading foreign State — Whether partial control over funds sufficient to base claim of immunity — Whether court bound to stay proceedings — Whether party not being the representative of the State nor its ambassador can raise issue of immunity — The law of Australia

Mistaken Payments - The Right of Recovery and the Defences

extract] Suppose ABC Bank wrongly followed instructions of customer A. Instead of paying recipient Bank X where A had an account, ABC Bank paid Bank Y where A also happened to have an account. Can ABC Bank recover the payment from Bank Y? Consider another scenario: customer B had instructed ABC Bank to pay $50,000 to recipient Z. By virtue of a computer error, Z was credited with $500,000. Is ABC Bank able to seek restitution from Z? In 1987, the High Court in ANZ Group Ltd v Westpac Banking Corporation clarified two very important questions about the right of recovery for money paid under mistake of fact. It said that the plaintiffs did not have to show that they paid under a supposed liability to pay nor did they have to show that the mistake was one that had to be shared by the payee. Furthermore, the High Court recognised that the basis for recovery should no longer be regarded as lying in implied contracts but rather, on the basis of restitution or unjust enrichment.

Valuing Employee Share Options: Four Australian Case Studies

We take four case studies to illustrate three issues: how ESOs are valued; how the valuation depends on assumptions; and how US proposals to account for ESOs would affect a company's financial profile. We adopt the Black‐Scholes options model to value ESOs issued by Brambles Industries, Coles Myer, Tabcorp Holdings and Westpac Banking Corporation. Under the FASB's proposal, after‐tax profit is lower and shareholders' funds and assets are higher beginning with the grant date. At the end of the amortisation period, assets and shareholders' funds would be the same as under current practice, but the fair value of the ESOs on their grant date would have been transferred from unappropriated profits to issued capital.

WESTPAC BANKING CORPORATION v DONALD MURRELL

WESTPAC BANKING CORPORATION v DONALD MURRELL

THE APPROPRIATE ROLE FOR THE PUBLIC SECTOR IN POSTAL SERVICES

Economic Papers: A journal of applied economics and policyVolume 10, Issue 3 p. 76-80 THE APPROPRIATE ROLE FOR THE PUBLIC SECTOR IN POSTAL SERVICES SHARON G. WATERHOUSE, SHARON G. WATERHOUSE The author is a graduate trainee with Westpac Banking Corporation. The article was written when the author was an undergraduate at Macquarie Univerity.Search for more papers by this author SHARON G. WATERHOUSE, SHARON G. WATERHOUSE The author is a graduate trainee with Westpac Banking Corporation. The article was written when the author was an undergraduate at Macquarie Univerity.Search for more papers by this author First published: September 1991 https://doi.org/10.1111/j.1759-3441.1991.tb01101.x AboutPDF ToolsRequest permissionExport citationAdd to favoritesTrack citation ShareShare Give accessShare full text accessShare full-text accessPlease review our Terms and Conditions of Use and check box below to share full-text version of article.I have read and accept the Wiley Online Library Terms and Conditions of UseShareable LinkUse the link below to share a full-text version of this article with your friends and colleagues. Learn more.Copy URL Share a linkShare onFacebookTwitterLinked InRedditWechat Volume10, Issue3September 1991Pages 76-80 RelatedInformation

Using Management Competencies to Improve Management Performance and Stimulate Self Development

Like most organisations in the financial sector in Australia, Westpac BankingCorporation has been introducing new management practices in order tohelp it compete in an increasingly dynamic and competitive marketplace. Thispaper reviews some of the changes that have been affecting financial serviceorganisations and reviews some of the ways in which Westpac has responded tothem. The paper focuses on the changing definition of management performance'within Westpac. A description is given of the methodology used to develop theorganisation's current system for assessing management performance in termsof management competencies which have been shown to be associated withsuccessful job performance. The paper concludes by discussing the benefits of including an assessment ofjob competencies in an organisation's performance appraisal process. Not onlydo competencies provide behaviourally based (and therefore more objective)foundation for a variety of personnel practices, but they can also signal andreinforce changes in individual behaviour as part of broader changes in corporateculture.

WESTPAC BANKING CORPORATION v GOLLIN AND CO LTD (In liquidation)

WESTPAC BANKING CORPORATION v GOLLIN AND CO LTD (In liquidation)