Westpac Banking Corp.

In our view, Westpac and the other Australian major banks' dependence on domestic and offshore wholesale funding remains a weakness; notwithstanding improvements over the past 10 years across the Australian banking system. The ratings on Westpac also benefit from our expectation that the Australian government is highly likely to provide timely financial support to the bank, if needed. The outlook on Westpac is stable. We believe Westpac's credit losses peaked in 2020, following the damage inflicted by the pandemic. In our view, credit losses over the next two years should remain low and close to pre-COVID-19 levels. Consequently, we expect earnings to remain sound despite low interest rates. We see very limited upside to our issuer credit ratings on Westpac

...We expect Australia-based Westpac Banking Corp.'s strong market position and focus on low-risk retail and commercial banking activities in Australia and New Zealand to continue to support its earnings profile. The economies of both countries are recovering strongly after the hit from the COVID-19 pandemic. Westpac's robust capitalization will remain a strength to its credit profile; as will its low credit losses, which we expect to remain low and close to pre-COVID levels in the next two years. In our view, Westpac and the other Australian major banks' dependence on domestic and offshore wholesale funding remains a weakness; notwithstanding improvements over the past 10 years across the Australian banking system. The ratings on Westpac also benefit from our expectation that the Australian government is highly likely to provide timely financial support to the bank, if needed....

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