Westpac’s BT Financial focused on growth despite “intense” regulatory scrutiny

GENERIC banking foreign exhange dollar Westpac money exchange rate economy 11th July 2016 photo by Louise kennerley afr Photo: SuppliedWestpac’s wealth management division has shrugged off “intense” regulatory scrutiny of the financial advice and life insurance sectors, saying it is on track to deliver growth in these areas.

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BT Financial Group chief executive Brad Cooper said new compliance measures to protect consumers had cost the investment arm millions over the last two years, but that these “headwinds” would not impact future earnings.

“Regulatory scrutiny has been intense and the workload has been pretty big for all our people and we’re not through it yet,” he said.

“[But] we’ve been able to maintain the earnings while going through those transitions.”

Mr Cooper said BT was well-positioned to benefit from increased demand for financial advice, particularly as the super sector was set to grow.

“Currently financial advice is only being accessed by one in five people. Add to that superannuation assets doubling to around $4 trillion over the next nine years and there is an obvious need to help more Australians into a dignified retirement,” he said.

He said the company was focused on a new “flexible advice” model which would offer customers “everything from general and single-topic advice to full personal advice” when and wherever the customer wanted.

“Customers are demanding more convenience, flexibility and the ability to be helped on their terms and we have reshaped our business and built the tools to meet these needs,” he said.

The corporate watchdog is currently taking legal action against Westpac and BT Funds Management for breaching the “best interests” obligation and providing financial advice when they were not permitted to do so.

The case relates to advice given during a telephone sales campaign targeting superannuation fund members.

BT has denied any wrongdoing and is defending the case in court.

Meanwhile, a report last week found Australia’s biggest banks were taking up to six months to notify the corporate watchdog when they found misbehaving advisers, and frequently failed to properly check the background of the financial planners they employ.

Mr Cooper said he expected pressure from the corporate regulator to continue.

“We think it’s going to be ongoing,” he said.

BT Financial has also come under fire over sexual misconduct allegations this week following complaints by two female staff about the behaviour of a senior executive at BT Financial.

Fairfax Media revealed the complaints against BT’s chief investment officer, Martyn Wild, which included inappropriate contact and commentary which included telling a female staff member her appearance and weight would retard her career prospects.