UPDATE 1-Australia’s Westpac looks to raise $1.7 bln as profit slumps 15%

(Reuters) – Westpac Banking Corp (WBC.AX) reported a 15% drop in full-year cash earnings on Monday and said it was looking to raise A$2.5 billion ($1.73 billion) as Australia’s No. 2 lender looks to beef up its capital levels to meet regulatory requirements.

The lender also cut its final dividend to 80 cents per share, from 94 cents a share a year earlier. That marked the bank’s first cut in a decade.

Cash earnings came in at A$6.85 billion for the year ended Sept. 30, down from A$8.07 billion a year earlier.

The lender warned weeks ago of a A$377 million hit to earnings in the second half, mainly because of customer remediation charges after a public inquiry into the financial sector exposed a slew of wrongful practices by the country’s Big Four banks last year.

“2019 has been a disappointing year. Financial results are down significantly in a challenging, low-growth, low interest rate environment,” Westpac Chief Executive Officer Brian Hartzer said in a statement.

Westpac, like others in the sector, is coping with record low interest rates, increased competition and higher capital requirements, while also dealing with a rising remediation bill. The one-off charges for the “Big Four” banks now nearly add up to A$5 billion.

Reporting by Nikhil Kurian Nainan in Bengaluru; Editing by Susan Fenton and Peter Cooney