Westpac Chief Says St. George In Better Shape Post Merger

Post by NeilMc on November 5, 2009 · Under Company News, banking · Comment

Gail Kelly, chief executive of Australian banking major Westpac wants the lenders subsidiary St. George, to continue a strategy of maintaining its position as Australia’s fifth largest bank.

Mrs. Kelly, who assumed the role of chief executive of Westpac after first heading up St. George prior to its acquisition, said that St. George was in better shape after the merger and had not suffered as a result of its acquisition.

St George’s operating income has grown 11 per cent over the last year, to $3.28 billion from $2.94 billion, whilst its earnings increased by 16 per cent to $2.08 billion.

“St George is actually stronger and healthier now than it has been. It occupies the positive of the fifth-largest bank and the largest regional player by a long way. What St George has done is to implement a new regional structure. There is now a lot of authenticity and authority in these regions.” Mrs. Kelly said.

Westpac has deliberately implemented a strategy of maintaining St. George as an independent entity instead of integrating the lender into the bank’s main operation.

The business model replicates Bank SA, also owned by Westpac, which is divided into key regional areas that report to management.

“St George has drawn from the Bank SA performance, which is a little gem of a business,” Mrs. Kelly said.

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