On Tuesday, the major bank confirmed the sale of Westpac Lenders Mortgage Insurance Limited (WLMI) to Arch Capital Group Limited Ltd (Arch) and that it has entered into an exclusive 10-year supply agreement with the group.
“This transaction further simplifies Westpac Group’s business portfolio and enables us to help more customers into home ownership, with LMI to be seamlessly integrated into our digital customer journey with a partner that has a longstanding relationship with Westpac,” Westpac chief executive, specialist businesses and group strategy, Jason Yetton, said.
The sale, first announced in March, is at book value and expected to be $350 million.
It also added 7 bps to Westpac’s common equity tier 1 capital ratio.
It comes only weeks after Westpac also completed the sale of its vendor finance business to Angle Finance.
Westpac has indicated all remaining businesses in its specialist division – which was created in 2019, and includes BT and Westpac Life Insurance – will be sold off as part of a broader cost-cutting and simplification strategy.
In its half-year results presentation in May, the bank said it would target an $8 billion cost base by 2024, with the offloading of specialist businesses to form a key part of the cost cutting.
