Westpac Banking Corporation (ASX: WBC) is back in the spotlight on Wednesday, 17 December 2025, as a trio of developments collide: a meaningful shift in Westpac’s own interest-rate forecast, fresh regulatory direction out of New Zealand that affects Australian-owned banks (including Westpac), and a steady drumbeat of valuation-focused analyst commentary as bank stocks digest a strong run.
At around late afternoon in Australia, Westpac shares were trading near A$38.42, down modestly on the prior close, with the day’s range roughly A$38.01 to A$38.50. Investing
Below is a detailed, investor-focused roundup of the key news, forecasts, and analysis driving Westpac stock today—plus what to watch next.
Westpac share price today: where WBC is trading on 17 December 2025
Market data providers showed Westpac shares around A$38.4 during Wednesday’s session, with a small decline versus Tuesday’s close. Investing
- Latest indicated price: ~A$38.42 Investing
- Prior close referenced by major quote pages: A$38.48 Investing
- Intraday range: ~A$38.01 to A$38.50 Investing
On the broader market, the ASX was softer, with ABC’s market live coverage noting the local index slipping again—hardly a friendly tailwind for a mega-cap bank stock trying to rally on its own. ABC
What’s moving Westpac stock on 17 December 2025
Today’s Westpac narrative is less about a single headline and more about the interest-rate “shape of the future”—because for banks, the outlook for policy rates drives:
- net interest margins (what banks earn on lending vs what they pay for deposits/funding),
- loan growth and mortgage demand,
- arrears and credit losses,
- and ultimately, dividend capacity.
The two biggest macro inputs hitting the tape today:
- Westpac’s economists have shifted their Reserve Bank of Australia (RBA) call (fewer/ later cuts). ABC
- New Zealand’s central bank has confirmed changes to bank capital settings, affecting the big Australian-owned banks operating there (including Westpac). Reuters
A third, smaller-but-not-trivial corporate update sits underneath: Westpac’s covered bond programme documentation refresh, tied to wholesale funding access. Investing
RBA rates: Westpac drops the 2026 cut call and now sees a long “hold”
One of the most market-relevant updates today is that Westpac has backed away from forecasting multiple rate cuts next year. ABC’s markets live blog summarised the pivot bluntly: Westpac is “backtracking” on a forecast for two cuts and is now forecasting the RBA to stay on hold through 2026. ABC
A separate report citing Westpac’s rate note adds colour: Westpac now expects rates to remain on an extended hold through 2026, with the possibility of cuts pushed into early-to-mid 2027, depending on how inflation and the labour market evolve. Investing
Why this matters for Westpac shareholders
A “higher-for-longer” rate path can cut both ways for a major bank:
- Potential upside: lending margins can stay supported if asset yields remain firm.
- Potential downside: competition for deposits can intensify, and credit stress can creep up if households and small business borrowers stay squeezed.
Westpac’s rate outlook update lands in a market that is already hypersensitive to inflation surprises and central-bank tone—so even a modest shift in expected timing can change how investors model bank earnings.
New Zealand’s capital review: a regulatory shift with real implications for Westpac NZ
The second major driver in today’s Westpac newsflow comes from Wellington.
Reuters reported that the Reserve Bank of New Zealand (RBNZ) has announced it will lower some capital requirements after reviewing rules introduced in 2019, while still keeping settings above international levels. Reuters
Key points reported by Reuters include:
- For the top four Australian-owned banks in New Zealand, the Common Equity Tier 1 (CET1) requirement is set at 12% (down from 16%). Reuters
- Tier 2 capital requirements increase to 3% (from 2%), and banks will be required to hold internal loss absorbing capacity of 6%. Reuters
- The RBNZ estimated the change could reduce average funding costs by about 12 basis points and deliver an annual net benefit of 0.12% of GDP, compared with fully implementing the prior rules. Reuters
Meanwhile, the RBNZ’s own capital review page (updated today) confirms the final decisions were announced on 17 December 2025, including reduced Tier 1 requirements for the largest deposit takers and the introduction of additional loss-absorbing capacity instruments—plus more detail to come later. Reserve Bank of New Zealand
So what could this mean for Westpac stock?
Westpac’s exposure here is not theoretical: New Zealand’s banking system is dominated by four large Australian-owned banks, including Westpac. Reuters
From an equity-investor perspective, the “translation” is:
- Lower required high-quality capital can, over time, ease pressure on returns (because less equity is tied up per dollar of lending),
- but the shift toward loss-absorbing capacity and rebalanced capital instruments can change funding mix and costs, and it won’t happen overnight.
Both Reuters and the RBNZ indicate that full implementation stretches out to 2028, with further detail and consultation material expected in February 2026. Reuters
Westpac funding update: covered bond programme documentation refreshed
On the corporate side, Westpac disclosed the publication of a supplementary prospectus connected to its US$40 billion Global Covered Bond Programme, with approval from the UK’s Financial Conduct Authority (FCA), according to a report based on Westpac’s statement. Investing
Covered bonds matter because they are a long-running part of how big banks diversify wholesale funding. This kind of update is usually not a short-term share-price catalyst, but it does sit inside the bigger story investors care about: the durability and cost of bank funding as the rate cycle evolves.
Dividends and fundamentals: the “real” reason many investors hold Westpac stock
While daily headlines whip sentiment around, Westpac remains—at its core—a dividend-and-balance-sheet story.
Final dividend: payment is imminent
Westpac’s investor centre confirms its 2025 final ordinary dividend of 77 cents per share (100% franked at the 30% company tax rate), payable on 19 December 2025, with New Zealand imputation credits of NZD 6 cents per share attached. Westpac
Westpac’s dividend payment history table also lists a DRP issue/plan price of A$38.09 for the 19/12/2025 dividend line. Westpac
FY2025 snapshot: what Westpac delivered in the most recent full-year results
In Westpac’s FY2025 full-year financial results document, the bank reported:
- Statutory net profit:A$6.9bn
- Net profit excluding notable items:A$7.0bn
- CET1 capital ratio:12.5%
- Full-year ordinary dividends:153 cents per share (fully franked) Westpac
The same results overview notes deposits and loans rose 7% and 6%, respectively, over the period, alongside commentary on segment growth and a low level of impairment charges in the second half. Westpac
For investors, today’s key linkage is simple: the rate outlook and capital rules (Australia + NZ) are the two giant levers that can change the future path of earnings, capital strength, and dividends.
Analyst forecasts for Westpac shares: price targets point to caution
Despite Westpac shares trading close to the upper end of their 52-week range, analyst consensus is notably less exuberant.
MarketScreener’s consensus page shows:
- Mean consensus:Underperform
- Number of analysts:13
- Average target price:A$33.86 versus a listed last close of A$38.48
- High target:A$40.00
- Low target:A$30.50 MarketScreener
Investing.com’s consensus estimates page aligns closely on both the A$33.86 average target and the A$30.5–A$40 target range, also describing the consensus stance as effectively “Sell” based on its analyst breakdown. Investing
How to read this (without getting hypnotised by a single number)
The spread of targets tells you something important: analysts disagree on what happens next to margins, loan growth, and credit quality if rates stay restrictive longer than previously expected.
- If “higher-for-longer” supports margins without breaking borrowers, targets can look conservative.
- If deposit competition bites and arrears rise, the cautious consensus starts to look more reasonable.
Westpac’s own growth signals: leading index points to stalling momentum into 2026
Adding to today’s macro-heavy tone, an update on the Westpac–Melbourne Institute Leading Index suggests Australia’s growth pulse has cooled.
A report on the release said the six‑month annualised growth rate eased to +0.16% in November (from +0.32% in October), with Westpac economist Ryan Wells describing it as indicative of “stalling in momentum.” Australian Broker News
The same coverage says Westpac expects activity to pick up only slightly—from 2.1%yr currently to 2.4%yr over 2026—roughly around trend, while the more hawkish policy backdrop has pushed the timing of any further easing into 2027. Australian Broker News
That’s not a Westpac-share-specific metric—but it’s absolutely a Westpac-earnings metric, because bank balance sheets tend to grow (or stagnate) with the real economy.
Also today: Westpac’s market “Morning Report” flags global risk tone
Westpac IQ’s Morning Report dated 17 December 2025 emphasised mixed US labour signals, a rally in US Treasuries, a third consecutive drop in the S&P 500, and ongoing pressure in crude prices tied to geopolitics—useful context for why equity markets (including bank stocks) may be jittery even when company-specific news is limited. Westpac IQ
What to watch next for Westpac stock
Here are the near-term markers that matter most after today’s news burst:
- RBA expectations and inflation data: Westpac’s updated “hold through 2026” call puts incoming inflation and labour prints back in the driver’s seat. ABC
- New Zealand capital rule details (February 2026): both Reuters and the RBNZ point to more disclosure and consultation ahead. Reuters
- Next earnings date: Investing.com lists Westpac’s next earnings report timing as 16 February 2026. Investing
- Dividend payment (19 December 2025): the near-term cash event that many income-focused holders are watching. Westpac
Bottom line
On 17 December 2025, Westpac stock is being shaped by macro and regulation more than micro: Westpac’s own forecast shift toward a longer RBA hold, New Zealand’s capital framework update, and investor attention on valuation after a strong stretch for bank shares. ABC
Westpac still has the classic bank appeal—scale, dividends, and capital strength—but today’s headlines underline the ongoing tension investors must price: supportive margins vs. slower growth and higher credit risk if restrictive policy persists. Westpac
