Australian banking major has retained McKinsey the global management company as it seeks to wring out tens of millions of dollars in savings across its operations.
It is believed the appointment of McKinsey as a consultant occurred during the last few weeks, and the company is providing advisory on how Westpac can achieve greater efficiency in its IT, outsourcing and management tiers.
Westpac declined to make any comment either on the appointment of that it was targeting savings of $90 million. A spokesperson did say the lenders long term focus was centered on productivity and improving its model as a bank supplier.
“We have made significant progress with this,” he said.
“We work with a number of consultants, including McKinsey, on a range of projects.
Westpac has already begun on a cost cutting exercise with the lender announcing as many as 560 job cuts earlier in the year, citing higher funding costs and a dramatic slowdown in lending.
“This is the largest announcement we are likely to make this year, but as I indicated, we are in a changing world and it is really important to have a strong banking system,” Mrs. Kelly said.
During Westpac’s first quarter earnings update the lender said it has made good progress on its sourcing arrangements, though it had failed to obtain a significant reduction in its expenses.
According to the lender the exercise was simply a one off, with costs falling to below $200 million that was recorded as cash earnings adjustment.
Brian Hartzer a former banker with ANZ is tipped to join Westpac in June, leaving his current position with Royal Bank of Scotland. His role at Westpac will be running an expanded retail unit that comprises both business and personal banking operating of St George and BT wealth Management