The Westpac Banking Corp (ASX: WBC) share price is edging lower on Friday.
At the time of writing, the banking giant's shares are down 0.5% to $22.64.
Why is the Westpac share price in the red?
The Westpac share price is edging lower on Friday following the release of the bank's first quarter update.
Although the update didn't provide any profit or margin figures, it did give investors an idea of how Westpac is performing.
The bank revealed that its credit quality and capital position remain strong, with Australian 90+ day mortgage delinquencies falling five basis points to 0.7% and a CET1 ratio of 11.13%.
Westpac also revealed that its liquidity coverage ratio (LCR) was up 7 percentage points to 139%, its net stable funding ratio (NSFR) was up 1 percentage point to 122%, and its deposit to loan ratio came in 1.1 percentage points higher at 84%.
Goldman Sachs has responded to the update and notes that there are both positives and negatives. It explained:
WBC has released its Dec-22 (1Q23) Pillar 3 update, which suggests WBC's asset quality was run-rating slightly better than what was implied by our prior 1H23E forecasts, while the CET1 ratio was broadly consistent. As we had expected, no earnings update was provided. However, the slightly lower than expected RWAs could imply that either i) earnings were slightly below, and/or ii) capital deductions were slightly higher than what was implied by our 1H23 forecasts.
Should you invest?
While not blown away by the update, Goldman remains positive on the Westpac share price and has reiterated its conviction buy rating with a price target of $27.74.
This implies potential upside of 22% for investors over the next 12 months.