At the time of writing, the bank’s shares are down 0.1% to $24.67.
What did Westpac announce?
This morning the banking giant confirmed that the Australian Prudential Regulation Authority (APRA) has approved its Integrated Plan that was developed in response to the Enforceable Undertaking. The latter followed an investigation by the financial crime watchdog AUSTRAC into alleged breaches of anti-money laundering and counter-terrorism financing laws.
Under the terms of the Enforceable Undertaking, which Westpac entered into on 3 December 2020, Westpac was required to submit for APRA approval a detailed integrated plan that outlines all major remediation activities related to risk governance.
In addition to this, the plan was required to have clear timelines and specify who is accountable for delivery. It also outlines commitments designed to strengthen all aspects of Westpac’s risk governance across both financial and non-financial risk.
Management notes that another requirement of the Enforceable Undertaking is that the integrated plan is independently assured.
In response to this, Westpac appointed Promontory Australasia to provide quarterly assurance and intends to release their reports bi-annually. The first report for the period up to 1 March 2021, has been released today. You can read about it here.
In the report, Promontory Australasia acknowledges the completeness of Westpac’s integrated plan, as it expands on its existing Customer Outcomes and Risk Excellence (CORE) Program. The consulting firm also notes that appropriate governance and accountability structures are in place to support effective implementation of the plan.
Westpac’s CEO, Peter King, said: “Our Integrated Plan outlines a comprehensive program of work to ensure the bank’s risk culture and risk governance meet the high standards expected of us. We have made progress on improving our management of risk over the past 12 months, however there is much more work to do to ensure sustainable change. The implementation of our Integrated Plan is a critical part of delivering on our Fix, Simplify, Perform strategic priorities and is one of my top focus areas.”
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Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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