In announcing its interim results, Westpac said BTFG, the wealth and insurance arm of the business, saw cash earnings hit $452 million, down slightly on the $453 million cash earnings for the corresponding period last year.
BTFG chief executive Brad Cooper said the result was impacted by market volatility and increased regulatory change and compliance obligations.
“The industry is operating in a challenging environment and will continue to do so for the foreseeable future,” he said.
The funds management business delivered cash earnings of $262 million, down $21 million, or 7 per cent. First half 2016 results reflect the full period impact following the partial sale of BTIM in June 2015 and the move to equity accounting of $8 million.
Advice income was down $22 million, with investors continuing to maintain a cautious approach, the bank said in its results statement.
Despite this, BTFG saw an improvement in its life insurance business.
Insurance cash earnings were up 3 per cent to $162 million and the business saw growth in life insurance in-force premiums and higher premiums in lender’s mortgage insurance.
Loss rates across the business were broadly unchanged, while Mr Cooper noted BTFG saw $275 million in life insurance claims last year.
“Life insurance remains a topic of interest and I am incredibly proud of our genuine ‘customer first’ culture which has allowed us to stand out in the market,” he said.
“We were the first retail insurer to extend the life expectancy time provision for terminal illness conditions, from 12 months to 24 months, and last year we were the only company awarded the top ‘A*’ rating from The Risk Store, reflecting our excellence in claims processes and customer service.”
Mr Cooper said given ongoing heightened regulatory and compliance requirements within the industry, he was also pleased that BT’s licensing solutions continued to attract high-quality firms looking to run compliant and efficient businesses.
“Having access to high-quality advice has never been more important and we are proud to be helping ensure more Australians can prepare for their best financial future,” he said.
At the same time, Westpac Group has reported cash earnings of $3.9 billion, up 3 per cent on the six months ending 31 March 2015. Statutory net profit was $3.7 billion, also up 3 per cent.
