• Westpac has unveiled a $288 million windfall after selling around half its Coinbase shares, profiting strongly from the cryptocurrency trading platform.
• The bank also hailed gains of $18 million from the sale of its stake in buy now, pay latter operator Zip.
• But the bank still advised it will cop a $282 million hit to first-half profits thanks to a slew of other costs.
  
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Westpac has announced a $288 million windfall from the sale of nearly half its Coinbase shares — but that won’t be enough to overturn an estimated $282 million downgrade to the bank’s first-half profit.

In a Monday note to shareholders, the bank revealed a gross gain of $546 million, after it sold around 50% of its 1.2 million-share stake in the booming cryptocurrency trading platform.

The $288 million figure comes after tax and performance fees for its pet venture capital fund Reinventure, which first bought into Coinbase in 2015.

The note confirms Westpac made good on Coinbase’s recent Nasdaq listing, which saw Australians funnel millions of dollars towards its IPO.

But the cryptocurrency market was not the only up-and-coming financial sector which provided the goods for Westpac.

According to the note, the bank also copped an $18 million payout after selling shares of buy now, pay later player Zip.

That particular cash influx comes some five months after Westpac confirmed the offloading of its Zip stake for $367 million, amid the bank’s new deal with Zip nemesis AfterPay.

Yet those gains could not offset the estimated $220 million put aside for “customer refunds, payments, associated costs, and litigation provisions,” nor the $115 million in write-downs on capitalised software and “other intangibles.”

Nor could those blockchain benefits counteract the cost of Westpac dissolving its relationship with wealth management firm IOOF (clocked at $56 million), a write-down of goodwill linked to lenders mortgage insurance ($84 million), and a loss linked to the sale of Westpac Pacific ($113 million).

The announcement comes a matter of days ahead of Westpac’s first-half earnings announcement, which will be shadowed by the September announcement that Westpac is on the hook for a $1.3 billion settlement with AUSTRAC, after allegations the bank breached anti-money laundering and counter-terrorism laws as many as 23 million times.

A flourishing stake in a cryptocurrency trading platform is one thing, but even in this red-hot market, $1.3 dollars is another matter entirely.

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