The Australian Prudential Regulation Authority (APRA) said on Monday that allegations against Westpac were "very serious" and the banking watchdog is mulling whether there needs to be further action to address the issues presented.
According to Reuters, APRA chairman Wayne Byres reiterated that while the regulator will not "duplicate or cut across" the authority that Australian financial intelligence firm Austrac has over the case, the APRA board is weighing what it can do regarding the matter.
Byres noted that among the issues the board is looking at are Westpac's liabilities under the Banking Executive Accountability Regime as well as possible action on how the Australian bank's management should be revamped.
The APRA's comments came just days after superannuation fund HESTA warned that support for the reappointment of Westpac directors will largely be impacted by how the bank delivers on requests for a clearer action plan moving forward.
HESTA chief executive Debby Blakey said last week that the super fund has requested a more specific and detailed plan on how the bank will respond and correct the problems raised by Austrac in its investigations on the bank's operations.
According to the Sydney Morning Herald, Blakey noted that the fund will "give careful consideration" on how it will vote during this month's annual general meeting, adding that the the move is just as crucial as letting Westpac know about its main concerns.
It was reported earlier last week that the Australian bank has held crisis talks with some of its big investors following Austrac's revelations about the financial institution's alleged breaches of over 23 million banking laws.
The bank is also expected to face legal charges over Austrac's revelations that the bank breached regulations involving money laundering transactions as well as exchanges that displayed consistencies with child exploitation in the Philippines.
Industry experts are expecting the case to result in fines that could hit up to $1 billion, The Guardian reported. The estimates were based on the case of Commonwealth Bank, wherein the institution was forced to pay $700 million for 53,000 breaches related to anti-money laundering laws.
Aside from APRA, the Australian Securities and Investments Commission (ASIC) previously expressed its desire to look into Westpac's business operations following the allegations. The intervention of regulatory boards came despite the bank's decision to cut off two executives.
Westpac announced the resignation of CEO Brian Hartzer last week, as well as the early retirement of chairman Lindsay Maxsted. It remains to be seen whether APRA will move in a similar way as HESTA did with its request for more board action.
