I think it is fair to say that the Westpac Banking Corp (ASX: WBC) share price has had a pretty terrible month.
In fact, month-to-date the shares of Australia's oldest bank are down a whopping 13%.
For the last few months I have warned against an investment in Westpac, believing that its shares and those of its rival Australia and New Zealand Banking Group (ASX: ANZ) are simply too expensive.
But after its sharp decline in the last month, I'm finally seeing value in its shares at long last.
At the current share price Westpac's shares are changing hands at approximately 13x trailing earnings. This is close to its historic average and a level I deem to be fair.
Furthermore, its shares provide a fully franked trailing 6.2% dividend at the current share price. Even if we take off the 8 cents per share impact from the proposed bank levy, its shares would still provide a 5.9% fully franked yield.
That's a great yield and a massive 170 basis points higher than the market-average.
But of course there are downside risks to consider before making an investment in Westpac or any of the banks.
Whilst I am confident that the bank fully understands the impact the new levy will have on its business, there is always a danger that its impact is worse than predicted.
Furthermore, although I don't expect there to be a housing market crash, were one to occur then it is inevitable that the banks would suffer greatly.
But if you're like me and confident that it is business as usual for the banks now, then I think Westpac's generous dividend could be worth snapping up today.
