FINS3630 Group Assignment – Instructions and Guidelines
2022 Term 1

Banks are subjected to a wide array of risks during their operations. Risk management
is about understanding and managing the Bank's risk environment and taking measures,
where necessary, to ensure that risks are contained to acceptable levels, while making sure
loss-absorption buffers are sufficient. In addition, the analysis of banks must also consider
the current status of a country’s financial system and overall economy.
Financial statements offer a window into the operation and management of a bank. The
financial statements for banks can look very different from those reported by most
companies. The nature of banking operations means that there will be unique items on a
bank’s balance sheet. In addition, banks are also subject to some unique accounting
standards and financial regulations.
As an expert team in banking, you and your team members are asked to identify and
analyse bank financial risk by the usage of information provided by financial statements and
other public disclosures.
Your team are required to read Westpac Banking Corporation (Westpac)’s 2021 Annual
Report and its Pillar 3 capital disclosures, conduct relevant research, and write a detailed
report. Below are a list of questions your team report should address:
a) Credit Risk
1. Examine the composition of the bank’s asset portfolio and analyse the credit
exposures and credit quality of assets held.
2. Westpac uses provision coverage ratio (total loan provisions as a % of credit risk
weighted assets) as one of its credit risk measures. Compare Westpac’s data to its
peers (the other ‘big four’ banks in Australia), assess and comment on whether
Westpac’s credit risk is within or below peer range.
3. What are the main strategies that the bank has used to control/manage credit risk in
the context of the COVID pandemic?
b) Liquidity Risk
1. Analyse and comment on the composition of the bank’s total funding.
2. Comment on the bank’s Net Stable Funding Ratio and Liquidity Coverage Ratio
relative to the minimum regulatory requirements.
3. What are the strategies used by the bank to keep these ratios in compliance with the
regulatory requirements in the context of the COVID pandemic?
c) Capital Adequacy
1. Present the key capital ratios for each quarter in the 2021 reporting year and the
preceding year.
2. Comment on the trajectory of the capital ratios over the 2-year period. What does
this tell you about the capital risk of the Bank relative to the APRA requirements in
the context of the COVID pandemic?
3. On 1 November 2021, Westpac announced its intention to undertake a $3.5 billion
off-market share buy-back. Comment on the implication of the buyback on the
bank’s capital management.

General Instructions:
• This is a group assignment. Each group should have a minimum of 4 to a maximum of 5
members. You are expected to work collaboratively on this assignment.
• You are required to register yourself into a group via the group builder tool on Moodle.
Group formations must be finalized by 5pm Friday of Week 3. The sooner you finalize
your group, the more time you have on this assignment.
• You are encouraged to include tables and graphs in your report.
• You may also use the textbook or other online resources as references. All sources must
be carefully cited in a reference list.
• To write a successful report, please carefully read the marking criteria in the last page.
Format:
• Your written report should have a maximum of 12 pages in length. Tables and graphs
are counted into the page limit. Reference list, table of content, and cover page are not
included in the page limit.
• You can include formulas, middle-step work, notes or raw data in the Appendix, which is
not included in the page limit. However, main graphs and tables should always be
included in the body of the report, NOT in the Appendix.
• Line spacing should be at least 1.5. Front should be Arial or Calibri with a size of 12.
Margin should be Moderate or Normal.
• A general report structure should be used. Your report should include an introduction
and conclusion with appropriate headings to facilitate reading.
• All materials used in this report must be referenced in Harvard format. Any assessment
submitted without a reference list will not be marked. For details and assistance on
Harvard referencing, see https://student.unsw.edu.au/harvard-referencing


Submission:
• Due date: the assignment should be submitted electronically on Moodle by the Friday of
Week 10 on the 22 April at 11:59 pm.
• You are required to submit your assignment as a group TWICE:
1) Submit through the Turnitin link to check for copying and plagiarism.
2) Submit through the Assignment Submission link for grading purpose.
• The submission should be done by one member from your team and only assignments
with BOTH submissions will be graded.
• A penalty of 20% grade deduction will apply for each day of late submission after the
due date.
Evaluation:
You will each provide a confidential evaluation of each of your fellow group members by
completing a team evaluation survey. A 5% penalty will apply for not completing the survey.
Please make sure your response in the survey is a fair reflection of each group member's
contribution. If you give a too high or too low rating, you will provide an explanation of your
reasons for doing so.

Some Useful Links:
https://www.westpac.com.au/about-westpac/investor-centre/financial-
information/annual-reports/
https://www.westpac.com.au/about-westpac/investor-centre/financial-
information/regulatory-disclosures/
https://www.westpac.com.au/about-westpac/investor-centre/
https://www.apra.gov.au/news-and-publications

Detailed Marking Criteria
Criteria
Poor
<50% (Fail)
Below Average
50% - 64% (Pass)
Average
65% - 74% (Credit)
Above Average
75% - 84% (Distinction)
Exceptional
≥ 85% (HD)
Depth and
comprehensiveness
of the analysis
(40%)
Show little
understanding and
reasoning
Show some thinking and
reasoning but most ideas are
underdeveloped and unoriginal.
Main points lack detailed
development. Ideas are vague
with little evidence of critical
thinking and research.
Content indicates thinking and
reasoning applied with original
thought on a few ideas.
Main points are present with
limited detail and
development. Some research
and critical thinking are
present.
Content indicates original thinking
and develops ideas with sufficient
and firm evidence.
Main points well developed with
quality supporting details and
quantity. Critical thinking and are
weaved into points.
Content indicates synthesis of
ideas, in-depth analysis and
evidences of original thought and
support for the topic.
Main points well developed with
high qualitive and quantitative
support. Reveals high degree of
critical thinking.
Organization and
Structure (40%)
Writing lacks logical
organization. Serious
errors.
Writing has some logical
organization.
Many ideas are difficult to
follow; Includes irrelevant
material or go off track. Parts
are loosely linked or mixed.
Writing is coherent and
logically organized. Each
paragraph has a mainly clear
focus.
Some points remain misplaced
and stray from the topic.
Transitions evident but not
used throughout essay.
Writing is coherent and logically
organized with transitions used
between ideas and paragraphs to
create coherence. Overall unity of
ideas is present.
Writing shows high degree of
attention to logic and reasoning of
points. Unity clearly leads the
reader to the conclusion and stirs
thought regarding the topic.
Grammar and
Format (20%)
Spelling, punctuation,
and grammatical errors
are frequent.
Fails to follow most or
all format and
assignment
requirements.
Spelling, punctuation, and
grammatical errors create
distraction, making reading
difficult.
Fails to follow most format and
assignment requirements.
Most spelling, punctuation,
and grammar correct allowing
reader to progress through.
Some errors remain.
Meets most format and
assignment requirements with
some assembly errors.
Has few spelling, punctuation, and
grammatical errors allowing
reader to follow ideas clearly.
Meets format and assignment
requirements. Report is neat and
correctly assembled.
Free of distracting spelling,
punctuation, and grammatical
errors.
Meets all format and assignment
requirements and evidences
attention to detail. Report is neat
and correctly assembled with
professional look.