Westpac Banking has "unreservedly" apologised after Australia's financial crimes agency alleged a dozen customers funnelled money to southeast Asian nations to pay for child pornography and sexual abuse, amid the nation's worst ever breach of money-laundering laws.

"The notion that any child has been hurt as a result of any failings by Westpac is deeply distressing and we are truly sorry," chairman Lindsay Maxsted said in a statement after the board met on Friday. "As a board, and as individuals, we are devastated by the issues raised."

While not commenting explicitly on the future of chief executive Brian Hartzer, Mr Maxsted said the "board, CEO and management team are fully committed to fixing these issues".

Worst transgression

Mr Hartzer (52) has been under pressure since the bank was sued on Wednesday for allegedly breaching money-laundering laws 23 million times, a number that puts it among the worst transgressions reported globally in recent years.

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While Mr Hartzer has vowed to stay in the job and lead the response to the claims, the bank has faced criticism from prime minister Scott Morrison, pension funds and investors.

Westpac said it would appoint independent experts to review efforts to improve compliance with anti-money-laundering and counter-terrorism financing laws. – Bloomberg