Investors digested the results with Westpac shares trading around $36.10 in early action, reflecting concerns about a wider sector impact from the mortgage downturn.

In the quarter, Westpac’s CET1 capital ratio rose to 12.1%, with lending and deposits both up 2%.

M&A activity amid the downturn included I Squared confirming its acquisition of oOh!media and TabCorp agreeing to buy BetMakers for $267 million, signaling consolidation across sectors.

Macro considerations point to possible further rate hikes by the Reserve Bank of Australia if domestic inflation remains persistent, despite pauses.

The Future Fund revealed a 25% exposure to artificial intelligence, signaling a strategic tilt to capitalize on AI opportunities while maintaining diversified global investments.

The Australian share market fell today as Westpac’s shares dropped about 4.8% after it reported a 20% drop in mortgage applications following the May budget reforms and rate hikes, even though it posted a $1.8 billion quarterly profit.

Westpac lifted loan-loss reserves to a $2.0 billion overlay, with actual impairment charges modest at 10 basis points and stressed loans at 1.19%, implying a cautious but not disastrous outlook.

Westpac attributed the loan-book slowdown to Labor’s property tax reforms and said investor demand for housing credit would slow by more than half over the next two years.

Management signaled a cautious fourth quarter, aiming for slower mortgage-book growth and ongoing margin compression in Australian mortgages, though stronger business and institutional credit growth is expected, with a robust top-end pipeline.

The publication timestamp for the report was updated to 12:17pm on August 10, 2026, after an initial 12:14pm release.

The report sits within The Sydney Morning Herald’s National section, tying housing policy and mortgage activity to the broader national context.

The results and guidance align with a broader trend of cooling housing finance in the wake of the budget changes and rate hikes affecting peers like CBA, NAB, and ANZ.