Monday 17th June 2019
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ANZ Bank’s New Zealand chief executive David Hisco’s sick leave has turned into his permanent departure as board concerns about personal expenses surface.
The bank has confirmed Antonia Watson, who previously headed retail and business banking, will continue as acting chief executive.
“Mr Hisco’s departure follows ongoing health issues as well as board concern about the characterisation of certain transactions following an internal review of personal expenses,” the bank says in a statement.
“While Mr Hisco does not accept all of the concerns raised by the board, he accepts accountability, given his leadership position and agrees the characterisation of the expenses falls short of the standards required,” it says.
NZ chair John Key says that “we are disappointed David is leaving ANZ under such circumstances after such a long career.
“However, his departure is the right one in these circumstances, given the expectations we have of all our people, no matter how senior or junior.”
The announcement comes two weeks since the bank announced Hisco was taking sick leave and that Hisco’s doctor has said his prognosis is good.
The bank is “fortunate to have an experienced executive in Antonia Watson to step in while we conduct a search for a replacement,” Key says.
Hisco will receive his contracted and statutory entitlements to notice and untaken leave but will forfeit all unvested equity.
ANZ says both the Reserve Bank of New Zealand and the Australian Prudential Regulation Authority have been informed.
Hisco had been the New Zealand chief executive since 2010.
ANZ suffered a couple of regulatory blows last month with the Reserve Bank forcing it to hold more capital against housing and farm lending from June 30 and to use the standardised model for calculating its operational risk capital rather than its own internal model.
That’s because it had been using a modified internal model for calculating ORC since December 2014 without first getting RBNZ approval.
The ORC measure was one of about 45 internal models ANZ uses and it can continue to use the other 44.
Only the four major banks, which are all owned by Australia’s major four banks, are allowed to use their own internal models to calculate capital.
In February, RBNZ revealed that ANZ needed only slightly more than half the capital that the government-owned Kiwibank needs to back each $100 of mortgage lending because of the advantage it gains from using internal models.
Kiwibank, along with all the New Zealand-owned banks, is required to use standardised models.
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