Westpac Banking’s Initiative Towards Climate Change: What You Should Know

  • Nov 26, 2018 AEDT
  • Team Kalkine
Westpac Banking’s Initiative Towards Climate Change: What You Should Know

On November 26, 2018, Westpac Banking Corporation (ASX: WBC) came forward and made an announcement that they have rolled out Green Tailored Deposit which has been certified. This certification has to be obtained by CBI or Climate Bonds Initiative. Let us now get to know a little bit about this. This product carries a minimum transaction amount which happens to be A$1 million and has been categorized as an investment tool which is focused on the medium-to-long-term basis. This product has been developed by keeping in mind those market players who are in need of investments which focuses on climate change. All the deposits which would be garnered from the market players would be related to the projects or assets which comply with the criteria of Climate Bonds Initiative. These may consist of low carbon transport, renewable energy, water infrastructure as well as low carbon buildings.  

The top management of Westpac Institutional Bank reflected positive views in regard to this product. The management added that climate change happens to be the primary issue which is being dealt with and they are very much aware of the fact that it has the potential to impact the broader economy. However, they have maintained their complete focus to protect the economy’s prosperity. An independent specialist would be verifying the Green Tailored Deposits, and this verification would be done on an annual basis. Even the top management of Climate Bonds Initiative stated favourable views related to the green tailored deposits by stating that the market participants are now able to give their money which would be utilized towards solving the problem of climate change.

In FY 2018, the Westpac Institutional Bank division of Westpac Banking Corporation, which happens to be one of the leading banks in Australia, witnessed the negative impacts. This division’s revenues got adversely affected by the fewer number of the transactions which were large as well as by the lesser market’s income. However, as per the presentation, the expenses related to the consumer bank division witnessed the rise because of the remediation as well as investment. The New Zealand division of the bank witnessed favourable momentum, and it also encountered a fall in the expenses. Moving forward, the performance of the Westpac Banking would be dependent upon the consumer as well as business confidence prevailing in the Australian economy.

On November 26, 2018, Westpac ended the session in red. The bank’s stock price settled at A$25.950 per share which implies the fall of A$0.090 per share or 0.346%. Westpac has managed to deliver the return of -1.10% in the span of one month.


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