ANZ Bank’s NZ chief executive leaves after expense review

Photo: ANZ website

Australia and New Zealand Banking Group Ltd on Monday said the chief executive officer of its New Zealand unit has agreed to leave the bank by mutual consent, in the unit’s latest blow following censure from the central bank.

ANZ in a statement said its board had raised concerns about David Hisco’s characterisation of certain expenses and transactions after an internal review. It also said Hisco, CEO of the unit since 2010, did not accept all of those concerns.

The departure is an additional headache for ANZ, one of the four Australian-owned banks that dominate the New Zealand market. A month ago, the Reserve Bank of New Zealand revoked ANZ’s local licence to calculate its own operational risk capital due to “persistent” control failures.

The censure in turn comes as the central bank is undertaking broader measures to increase capital requirements and reduce risk to the financial system in preparation for any major shock.

In a news conference following the announcement of Hisco’s departure, ANZ New Zealand Chairman and former Prime Minister John Key said the Hisco’s departure related to the long-term use of corporate chauffer cars and charging the bank for storage of certain items without proper disclosure.

The amount in question ran into tens of thousands of dollars, said Key.

“His departure demonstrates that when people do not do the right thing we hold them to account no matter the status or position in the organisation,” Key said.

Hisco has not been required to return any funds and is adamant he had authority for the expenditure undertaken, Key said, adding the dispute was more about how the expenses were recorded in ANZ’s books.

Reuters was not immediately able to reach Hisco for comment.

In its statement, ANZ said Hisco’s departure was also partly due to health issues, without detailing those issues. Key added the departure should be characterised as parting company.

“It was mutual,” Key said.

Hisco had been with Australia’s third-largest lender for more than 30 years, according to the company’s website.

He will receive his contracted and statutory entitlements but has forfeited rights to about NZ$6.4 million ($4.2 million) in equity, Key said.

Antonia Watson will become acting chief executive, ANZ said.