---
endpoint: analytics
pattern: Financial Services
status: done
latency_ms: 96744
conversation_id: 63ee2f1a-8738-44a6-883e-0cbcfe5bf558
citations: 9
created: 2026-05-31 21:03:14Z
---

# What is Westpac’s core business franchise and the key components of its operating model?

## Westpac (WBC) — Core Business Franchise and Operating Model

### Core Business Franchise

Westpac's franchise is anchored in **banking for consumer, business and institutional customers**, with a stated purpose of "Helping Australians and New Zealanders Succeed" [3]. After a 2019–2020 strategic reset, the group narrowed its geographic and product perimeter, **returning to its core businesses of banking in Australia and New Zealand** while exiting peripheral activities [8]. The strategic review codified the perimeter as: (i) home markets of Australia and New Zealand, (ii) exit of non-core businesses, and (iii) a reduced product set [7].

The franchise's scale is illustrated by the 2H25 segment results — net interest income contribution by division: Institutional A$741m, Business & Wealth A$383m, Consumer A$296m, New Zealand NZ$137m, with the residual "Other" at A$22m [6]. At the time the Specialist Businesses division was carved out, **Banking accounted for ~90% of group revenue contribution and Specialist Businesses ~10%** [4]. The lending engine of the franchise remains the mortgage book — Westpac reported net loans of **A$510.3bn** in FY24 with mortgages growing 4% (below system, partly reflecting the closure of the RAMS sub-brand) [9].

### Operating Model — Key Components

**1. Five-pillar Lines of Business structure.** The bank is organised into five customer-facing divisions reporting through a "Line of Business" operating model: **Consumer, Business, Westpac Institutional Bank (WIB), Specialist Businesses, and Westpac New Zealand**, supported by Enterprise Functions running underneath [1]. Each line of business has **end-to-end responsibility for that business** — a single Managing Director owns the product (e.g., Mortgages), with the intent of clearer accountability and faster decision-making than the prior committee-driven, divisional-only structure [2].

**2. Specialist Businesses division (run-off / divestment vehicle).** A dedicated **Specialist Businesses** division was set up to house assets Westpac no longer views itself as the long-term owner of — namely superannuation, wealth platforms, investments, auto finance, general insurance, life insurance, and Westpac Pacific [4]. The remaining "core" comprises Consumer, Business, WIB and Westpac NZ.

**3. Strategic priorities: Fix → Simplify → Perform.** The operating agenda is structured into three priorities [3]:
- **Fix** — address risk management, risk culture, customer remediation, IT complexity.
- **Simplify** — exit non-core businesses, consolidate international operations, reduce product set, implement Lines of Business, transform via digital/data.
- **Perform** — market-leading customer service, growth in key markets, reset cost base, optimise capital, maintain a strong balance sheet.

**4. International footprint reduced to hubs.** Consolidation of international operations focused activity at hubs in **Singapore, London and New York** to support domestic customers offshore, with exits from Beijing, Shanghai, Hong Kong, Mumbai and Jakarta [2].

**5. "Unite" transformation programme with a three-in-a-box governance model.** Westpac's current multi-year transformation, branded **Unite**, runs in four phases (simplify being one of them) and is governed via a **three-in-a-box operating model** — business owns the change, with embedded technology and data experts — overlaid on the **three lines of defence risk framework** that was embedded under the earlier CORE (Customer Outcomes & Risk Excellence) programme [5]. Executive accountability is tied to remuneration scorecards, with CEO-led weekly oversight and a Board director working group providing additional governance [5].

**6. Risk and compliance scaffolding.** A standalone **Financial Crime, Compliance & Conduct** function reports directly to the CEO, alongside the broader CORE program, both put in place to remediate the AUSTRAC and Royal Commission issues [3]. This sits beneath all the customer-facing divisions as part of Enterprise Functions.

### Summary Table — Operating Model

| Component | Detail |
|---|---|
| Geographic perimeter | Australia + New Zealand (core); Singapore / London / New York hubs [2] |
| Customer-facing divisions | Consumer, Business, WIB, Specialist Businesses, Westpac NZ [1] |
| Structural logic | "Lines of Business" — end-to-end accountability per product line [2] |
| Core vs non-core split | Banking ~90% of group / Specialist Businesses ~10% (at carve-out) [4] |
| Strategic agenda | Fix → Simplify → Perform [3] |
| Transformation programme | Unite (4 phases, 60 initiatives, three-in-a-box governance) [5] |
| Risk framework | Three lines of defence; CORE program; dedicated Financial Crime function [5] |
| Latest scale signal | Net loans A$510.3bn (FY24); 2H25 NII led by Institutional A$741m [9][6] |

### Note on Sources
Internal RMS coverage for Westpac in this workspace is concentrated in CLSA's Australia strategy weeklies and the dedicated "Australian banks (ANZ the one to watch)" sector note (20 Jun 2025), where WBC is one of four covered names but is not the primary subject of a standalone franchise/operating-model deep-dive in the recent RMS set. The franchise/operating-model description above is therefore drawn from Westpac's own primary disclosures (annual reports, results presentations and earnings calls retrieved via TFS).

---
**Sources**
[1] Westpac Group 2020 Interim Results Presentation & Investor Discussion Pack — Westpac Banking Corporation (H1 2020)
[2] Westpac Group 2020 Annual Report — Westpac Banking Corporation
[3] Westpac Group 2020 Full Year Results Presentation & Investor Discussion Pack — Westpac Banking Corporation
[4] Westpac Group 2020 Interim Results Presentation & Investor Discussion Pack — Westpac Banking Corporation (H1 2020)
[5] Westpac Banking Corporation Investor Update — Unite transformation commentary
[6] Westpac Group 2025 Full Year Results Presentation & Investor Discussion Pack — Westpac Banking Corporation
[7] Westpac Group 2020 Annual Report — Strategic Review section
[8] Westpac Group 2020 Annual Report — "Our Priorities" section
[9] Westpac Banking Corporation Annual Report (FY24, dated 2025-02-05)

## Citations

- [1] **Westpac Banking Corporation, H1 2020** · external
- [2] **Annual Report** · external
- [3] **Presentation and Investor Discussion Pack** · external
- [4] **Westpac Banking Corporation, H1 2020** · external
- [5] **Westpac Banking Corporation, Investor Update** · external
- [6] **03017872_removed.pdf** · external
- [7] **Annual Report** · external
- [8] **Annual Report** · external
- [9] **Westpac Banking Corporation annual_report 2025-02-05** · external

