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Report: Westpac to divest dealer finance, auto loans biz in 2019 at earliest

Westpac Banking Corp. is looking to sell or float its A$5 billion dealer finance and auto loans business around March 2019 at the earliest, The Australian reported Feb. 27.

The lender is setting aside A$180 million to prepare for the divestment, and is working on introducing a new IT system to manage a fixed commission environment for the car loan business when strict new laws come into effect in November, the publication said.

Westpac has hired Morgan Stanley to assist with separating the dealer finance and auto loans business from the bank, and plans to put an independent team in place to manage the operation.

Following the separation of the dealer finance and auto loans division from the bank, 300 to 400 people could be hired to take on new jobs to run the business, the report noted.

In August 2017, Westpac said it was conducting a strategic review of its motor finance and equipment finance and corporate debt book.