Senior executives within ANZ’s institutional bank, including the former managing director, all resigned at around the same time the bank was subject to an investigation by the corporate watchdog over the alleged rigging of the bank bill swap rate.
The revelation came as ANZ also defended its treatment of small business customers, particularly farmers, to the parliamentary committee running the ongoing inquiry into the banking sector.
ANZ chief executive Shayne Elliott confirmed on Tuesday to the committee the executives had all let the bank “at around the same time”.
The executives named before Parliament today by Labor MP Matt Keogh were former global head of markets Steve Bellotti, former acting managing director of markets Eddie Listorti, former head of global markets sales Peter Maddox and former head of ANZ’s institutional bank Andrew Geczy.
However, Mr Elliott said the resignations of the executives were not linked to the bank bill swap rate investigation.
“Yes. They did leave at about the same time though for varying reasons,” Mr Elliott said.
“So, some were resignations, well they were all resignations actually. It was essentially to do with the way we restructured the bank.
“Some of it was a result of me coming in an undertaking a structural and cultural change within the bank. Some of those people were no longer the right people for those roles.”
He then clarified that the resignations were not related to BBSW, but added some of the challenges the bank had around rate rigging allegations were considered in the restructure.
“Were they taken into consideration in thinking the best way to run that business going forward, yes, of course,” Mr Elliott said.
When asked by Mr Keogh whether Mr Elliott’s pause before saying the men had resigned reflected whether ANZ had asked any of the men to resign, Mr Elliott said: “The reason I hesitated is you get into a delicate point of employment law. The reality is most of them were very simple resignations.”
ANZ, along with National Bank and Westpac have been accused by the n Securities and Investments Commission of rigging the bank bill swap rate. Small loan rejection
Mr Elliott was also pressed on the bank’s lack of support for a key recommendation from the small business banking inquiry conducted by Kate Carnell that small business loans under $5 million should not include non-financial covenants.
Mr Elliott said ANZ only used non-financial covenants to have “a conversation” with its customers and to leverage its view that the business should be improved. He said the market would change if ANZ was made to follow the recommendation.
“What will happen is that it will be harder for small businesses will have less access to credit and the credit they get will be more expensive and shorter term because the risk is higher,” Mr Elliott said.
Mr Elliott was challenged by committee chair David Coleman, who said that on the one hand Mr Elliott was saying the bank rarely used these clauses to foreclose on a loan, but on the other hand said that the bank needed the clause.
Mr Elliott said the clauses allowed the bank to stop small businesses from becoming distressed.Continue Reading →