The Westpac Banking Corp (ASX: WBC) share price is down 2.2% versus a 1.6% decline for the S&P/ASX 200 Index (ASX: XJO) today.
Westpac shares are trading at $37.70 apiece at the time of writing.
So, why are Westpac shares underperforming today?
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Why is the Westpac share price in the red?
Firstly, all the major ASX 200 bank shares are underperforming today, and financials are the weakest of the 11 sectors, down 2.3%.
This follows three days of gains for the banks after the Reserve Bank lifted interest rates, and hopes grew of a US-Iran peace deal.
The Westpac share price rose 2.34% between Tuesday and Thursday.
That's all changed today, with fresh clashes between the US and Iran overnight threatening to derail a peace plan under consideration.
The US is awaiting Iran's response to a plan aimed at reopening the critical oil shipping channel, the Strait of Hormuz, and ending the war.
Trading Economics analysts said:
According to reports, Tehran is expected to deliver its response through Pakistan within the next two days.
Separately, the IEA warned that the war was disrupting roughly 14 million barrels per day of global oil supply and noted that any post-conflict production recovery would likely proceed gradually.
However, Middle East tensions are not the only thing weighing on the Westpac share price today.
It's also ex-dividend day, which means Westpac shares are no longer trading with the next dividend entitlement attached.
Westpac shares are among 16 ASX stocks with ex-dividend dates this month.
Westpac shares will pay a fully-franked interim dividend of 77 cents per share on 26 June.
That's 1.3% lower than last year's interim dividend, and represents a payout ratio of 77.1%.
A recap on Westpac's 1H FY26 results
The bank revealed its 1H FY26 results earlier this week.
Westpac reported statutory net profit of $3.4 billion, up 3% on 1H FY25 and down 5% on 2H FY25.
The net profit excluding notable items was $3.5 billion, up 1% on 1H FY25.
Westpac said total lending and deposits both grew by 7% year over year.
The bank's common equity tier 1 (CET1) capital ratio was 12.4%, which is above the 11.25% target.
Westpac CEO Anthony Miller said:
Our strong balance sheet and disciplined focus will allow us to support customers through global uncertainty.
Growth is solid across lending and deposits, with several highlights.
We are managing costs while backing Australians through current challenges.
Westpac share price snapshot
The Westpac share price is up 24% over 12 months and down 3% in 2026 to date.
