November 4, 2019 / 11:37 PM / a month ago

Australia's Westpac completes $1.38 bln share placement, share price falls

Nov 5 (Reuters) - Australia’s Westpac Banking Corp on Tuesday said it completed a A$2 billion ($1.38 billion) share placement at a price on par with its underwritten level of A$25.32 a share, issuing all 79 million ordinary shares.

The issue price was at a 9% discount to Friday’s closing price. Westpac shares, which resumed trading on Tuesday, slipped as much as 5.1% to their lowest level in more than five months.

The country’s No.2 lender had announced a A$2.5 billion capital raising on Monday, as it looks to beef up its capital levels amid tougher regulatory requirements.

The capital raising also includes a non-underwritten share purchase plan through which the lender is targeting to raise an additional A$500 million.

Westpac on Monday reported a 15% slide in full-year cash earnings and cut its dividend for the first time in a decade, flagging weaker trading conditions ahead. Its results came just days after its smaller peer Australia and New Banking Group also missed profit expectations.

Australia’s “Big Four” banks are having to hold more capital at a time of record low interest rates, subdued credit growth, increasing competition and regulatory scrutiny after a government-backed inquiry into the financial sector exposed widespread misconduct.

$1 = 1.4531 Australian dollars Reporting by Shriya Ramakrishnan in Bengaluru; editing by Richard Pullin

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