The March quarter proved fruitful for the Westpac Banking Corp (ASX: WBC) share price.
The bank's stock surged 13.54% over the three months ended 31 March, closing the final session of the quarter trading at $24.24 apiece.
For comparison, the S&P/ASX 200 Index (ASX: XJO) gained just 0.74% over the same period, while the S&P/ASX 200 Financials Index (ASX: XFJ) improved 3.67%.
So, what pushed the Westpac share price to outperform most of its peers last quarter? Let's take a look.
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What drove the Westpac share price last quarter?
The Westpac share price was the worst-performing ASX 200 big four bank stock of 2021. But it bucked that trend to outperform its fellow 'fours' last quarter.
Firstly, it gained 2.28% on the back of its earnings for the December quarter.
The bank's unaudited cash earnings jumped 74% over the period, reaching $1.58 billion. Meanwhile, its expenses dropped 7% to $2.7 billion.
It also recognised a $118 million impairment charge mostly brought about by provision overlays reflecting COVID-19-related uncertainty.
On top of that, Westpac cut its c-suite – converging two executive positions into one new title – in an effort to simplify the business and reduce costs.
Additionally, the bank conducted a $3.5 billion off-market buyback last quarter. That saw it purchasing its own stocks from investors for $20.90 apiece and reducing its outstanding shares by 4.6%.
And while it didn't make price-sensitive news, Westpac announced in February it had completed the sale of its New Zealand life insurance business.
The bank sold the business for NZ$400 million (around $368.3 million at today's exchange rate). It expects to post a post-tax gain on the sale of approximately $90.25 million in its first-half results.
Westpac will also receive ongoing payments under a 15-year distribution agreement.
What else was the bank up to in the March quarter?
There were plenty of other happenings that likely didn't move the Westpac share price last quarter although they may have impacted market sentiment for the bank.
Firstly, Westpac technically found itself on the cusp of the big four banking group in January.
Macquarie Group Ltd (ASX: MQG)'s market capitalisation surpassed Westpac's, making the institutional bank the third largest ASX bank at that moment in time. Westpac has since regained its crown, according to the ASX.
In addition, the talk of the ASX last quarter was inflation, as many global market watchers expected the measure's increase to push interest rates higher.
In fact, the release of the latest consumer price index coincided with a disastrous day on the ASX 200.
On that note, Westpac upped its fixed interest rates three times last quarter.
On the bank's latest addition to "aggressive fixed rate hikes across the mortgage market", RateCity.com.au research director, Sally Tindall said:
Last year, Westpac had some of the lowest fixed rates in the market. Now there is daylight between the bank's rates and the low-cost lenders.
Westpac also joined other big four banks in cutting its variable interest rate late last month.
In more positive news, Westpac entered an agreement with Microsoft last quarter. The tech giant will help push the bank's digital strategy.
Westpac share price snapshot
Right now, the Westpac share price is trading 11% higher than it was at the start of 2022.
However, it's 4% lower than it was this time last year.
