Banks were lower after Westpac said it is looking to raise additional capital of $3.5 billion.
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Australia’s second largest lender also reported preliminary results for 2015, with cash earnings for the year up three per cent to $A7.8b.
Financials gave up 0.61 percent overall with the Commonwealth Bank of Australia down 0.66 percent, ANZ slumped 0.96 percent, the National Australia Bank (NAB) slipped 0.45 percent while Westpac is in a trading halt pending the completion of a 3.5 billion Australian dollar capital raising.
Westpac’s one-for-23 renounceable entitlement offer will comprise of an institutional and retail portion.
At 0654 AEDT on Tuesday, the December share price index futures contract was down 16 points at 5,208.
Westpac shares, which closed at $A30. All of Australia’s big four lenders have been raising capital to meet new requirements from the Australian Prudential Regulation Authority, which requires them to hold more capital on their books to mitigate the risk of losses on home loans.
Separately, the bank will raise the interest rates on its variable home loan and residential investment property loan rates by 20 basis points in response to increased capital requirements.
“While job creation well above or below the consensus forecasts of 5000 new jobs and 6.3% unemployment will speak directly to current trends, it will also inform RBA decision making”, he said. Statutory profit for the year rose six percent from last year to AU$8B.
Expenses in New Zealand rose 6%, which the attributes to costs launching its Westpac One online platform and a new reward credit card.
The Australian share market has opened nearly half a per cent lower, with the big banks and energy stocks leading the falls.
At 1058 aedt, National turnover was 403 million securities worth $835 million.
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The shares have declined about 5.3 percent in the past 12 months, underperforming the S&P/ASX 200 Index, which fell 0.8 percent in the same period.
