Shayne Elliott's legacy after ASX: ANZ scandals as new CEO Nuno Matos takes over
ANZ chief executive Shayne Elliott delivers half year results in Melbourne on Thursday. Picture: Arsineh Houspian.
Elliott has certainly left a cleaner bank and importantly a far less risky one that delivers fewer financial shocks, but Australia's perennial number four bank is still a long way from meeting its potential.
Former HSBC top executive and Santander banker Nuno Matos takes charge on Monday. It's by no means a broken business, however, where Elliot has unfinished work getting ANZ into shape, Matos' mandate will be all about execution.
When he took charge at the start of 2016, Elliott set himself four strategic priorities: creating a simpler bank; focusing ANZ on businesses where it can win; driving a cultural transformation; and building a digital platform to get the bank's aging technology in shape.
Elliott, the former institutional banker, moved quickly on the first two. He sold 30 businesses, mostly across Asia, and exited ANZ's problematic wealth management operations.
In doing so, he raised about $8bn for shareholders. This started the journey of ANZ becoming a transaction led bank in Asia, processing currency flows. Importantly, it ripped risk out of ANZ's accident-prone balance sheet.
'The one that I wouldn't give myself a perfect score on was the digitisation of the business. I think we've made progress. I think in hindsight, what I was a bit naive about was how hard that would be,' Elliott tells The Australian.
ANZ is today a lower risk bank than the one Shayne Elliott inherited. Picture:Getty Images
He is talking about the massive rebuild of ANZ's tech network, a project that has cost billions and was years late.
Only now Elliott's ANZ-Plus project is being switched on with nearly a million retail banking customers and all their banking data gradually being moved onto the new cloud-based platform. So the benefits of having a lower cost to serve is yet to be seen. A digital platform for business customers has also being built and is also being rolled out.
Elliott says 'life got in the way' for ANZ with events like the 2018 banking royal commission and Covid pandemic which each caused major distraction for the bank.
'I'm not making excuses, but I'm just saying if you'd asked me in 2016 where I would hope to be in 2025 we would have hoped to be further down that track. Some of it's environmental and some of it is just a lot harder than it looks'.
Elliot was speaking as ANZ posted a March half cash profit of $3.57bn, flat on the same time last year. The result was struck on record revenue and boosted by the first-time contribution of regional lender Suncorp bank, acquired by Elliott for $4.9bn. Stripping that contribution out, the headline result would have gone slightly backwards. The bank is generating record revenue and credit losses remain grounded near historic lows despite the interest rates hitting a cyclical high.
ANZ trading scandal
There's no doubt Elliott's legacy has been tarnished by the past year, when a bond scandal in his Sydney dealing room has attracted the attention of regulators. Several traders have since been sacked for behaviour issues, while market regulator ASIC has an investigation underway into more serious allegations of pricing manipulation in Australian government bond issues. ANZ has investigated the claims forensically and is expected to defend its position. However, it is waiting until ASIC finalises its investigation, expected next month.
The bank regulator APRA has now told ANZ to set aside $1bn in additional capital for now due to concerns about persistent risk governance and culture. This is more than any other bank, and would be funds otherwise that could be converted into loans.
A separate review into culture has made, and chairman Paul O'Sullivan has taken charge of non-financial risk.
Incoming ANZ CEO Nuno Matos (right) with chairman Paul O'Sullivan. Picture: Aaron Francis
Elliot says where ANZ has turned financial risk management into a strength, moving from a position of having the highest provisions and volatile credit exposures to the lowest there is work on non-financial risks. 'I'm also confident in the team's ability to get on top of that (non-financial risk) pretty quickly,' he says.
ANZ v Westpac, CBA
In many ways, the lack of acute regulatory shocks over the past decade has worked against ANZ. Both Commonwealth Bank and Westpac were shaken to the core by their respective hits from financial crimes regulator Austrac and forced to get their cultural houses in order. Then National Australia Bank went through the fire when its top management and board was singled out for criticism coming out of the Hayne financial commission.
By comparison, ANZ sailed through, allowing a degree of complacency to set in around non-financial risks. ANZ's federated structure of managing risk at a business level rather than a group-wide level, may have served it through targeted issues like anti-money laundering and the banking royal commission, but it still allowed cracks for non-financial risks and poor behaviour. ANZ is now reverting to a group-wide risk management, allowing it to join the dots.
The 61-year-old Elliott acknowledges he could have moved faster in some areas, this echoes the reflections both public and private company leaders have often told him.
'When people look back they never say, 'In hindsight, I was far too bold, and I was too fast'. They always say, 'I should have gone faster, and I should have had more courage' And I would say the same thing'.
johnstone@theaustralian.com.au
Read related topics: Anz Bank
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
ABC News
39 minutes ago
- ABC News
Home prices reach fresh record highs as rate cuts expected to fuel growth
Housing prices reached a fresh peak in June as falling interest rates boosted market confidence. The latest home value index from property research firm Cotality showed a fifth straight month of growth, with national dwelling values up 0.6 per cent, following a 0.3 per cent dip over the summer period. Every capital but Hobart saw values rise in the month, with the Tasmanian city recording a fall of 0.2 per cent. While regional markets were previously outperforming the capitals, the trend flipped in June, with the major cities recording a higher rate of growth. Data from REA Group's PropTrack also showed house prices at historic highs, with Adelaide experiencing the strongest monthly rise, up 0.6 per cent — now up almost 10 per cent over the year. "So far this year, the capital city markets are leading the charge," REA senior economist Eleanor Creagh told ABC News. The median house price in Brisbane is now over $1 million. "The biggest factor here absolutely is lower interest rates," Tim Lawless, the head of research at Cotality (formerly known as CoreLogic) explained. In February of this year, the Reserve Bank cut interest rates for the first time in almost five years, before delivering its second cut this cycle in May, taking the cash rate below 4 per cent. Cotality found Darwin recorded the strongest house price growth at 1.5 per cent in the month — largely due to the relative accessibility of investing there compared to other capitals. "I think the growth trend we're seeing now, which is evident over the past 12 months, is really being fuelled by this renewed level of investment activity coming into the Darwin marketplace and just the sheer affordability," Mr Lawless said. "We're looking at a median dwelling value in Darwin that's about $540,000 — quite low when you compare it to other markets. "Most markets are at near record highs and have been pushing to new record highs month after month, for some time," Mr Lawless noted. He labelled some markets as "extremes": "You've got markets like Perth, Adelaide, Brisbane that have seen values rise by more than 70 per cent in five years, and each of those markets has been at record highs for some time." Despite the high rates of growth, Mr Lawless said it was not as strong as in recent years. "If you go back, say, a couple of years, the rate of growth was about double what it is at the moment. With the RBA expected to deliver more relief for mortgage borrowers in a week, falling interest rates are tipped to fuel continued price growth. However, both Cotality and Proptrack cite several factors that should keep a lid on the increases, including elevated household debt, reduced demand from slowing population and migration growth, cautious lending policies and even geopolitical risk from events in the Middle East and Ukraine. "Stretched affordability is putting a bit of a handbrake on home price growth, and although we're seeing an upswing in prices this year as rates fall, we're seeing a more gradual pace of home price growth compared to previous easing cycles," REA's Eleanor Creagh said. "We're still seeing housing very much unaffordable for most Australians," Cotality's Tim Lawless agreed. "I think there's still a few barriers to really see the housing market take off from here. While borrowers may benefit from falling interest rates, it may be outweighed by the growth in home values, making owning a home no more affordable, according to Cotality. "The 2.4 per cent rise in national dwelling values through the first half of the year equates to a dollar value increase in the median dwelling value of approximately $19,000, eroding much of the benefits of lower rates when it comes to borrowing capacity," its report noted. As for renters, the pace of growth for rents has been slower than that of housing values, Mr Lawless said, describing it as "an ongoing slowdown". "The past 12 months, we saw national rents rise by just 3.4 per cent. So in annual terms, that's the lowest we've seen since early 2021. The lack of affordable housing has led to a change in household structures, he said, including the resurgence of share houses and multi-generational households. "Some of the largest slowdowns we've seen in rental growth have been in the largest capital cities, Sydney and Melbourne, particularly in the apartment markets," Mr Lawless said. "We've seen less demand coming in from net overseas migration, alongside other factors around rental affordability, just forcing a restructure in household structure. "We're seeing more group households reforming, multi-generational households are becoming more common as well, which I think is a clear reflection of rental affordability just driving this ongoing change in how people actually form a rental household."
ABC News
4 hours ago
- ABC News
Feeding time
And finally, as we edge towards a late supper some important culinary news. NICK HOSE: Chicken lovers were in a flap today thanks to a very generous giveaway. A takeaway giant celebrating its Portuguese heritage by offering up to 10,000 free hot chickens … - 7NEWS Border, 10 June 2025 A free bachelor's handbag! Seven News in Albury-Wodonga dispatched the cavalry, as they should, tout suite! DANIEL HERRERO: The crowd flocked into Lavington's Oporto store today. PERSON: I'm here for what everyone else is, you know, the free chicken, I suppose. PERSON: Free chicken day apparently, yeah. - 7NEWS Border, 10 June 2025 It wasn't merely a free chicken day, no! It was a celebration of the 16th Century's naval superpower! DANIEL HERRERO: O'Porto celebrating its Portuguese heritage on the country's national day, Dia de Portugal … - 7NEWS Border, 10 June 2025 The crew at Nine News' Gold Coast bureau brought us more of this most compelling of celebrations: EVA MILIC: Enough to feed a whole family and the best part is, it is free … - 9News Gold Coast, 9 June 2025 Woodward and Bernstein, eat your heart out. With this flame-grilled goodness and cluckin' good giveaway spreading like salmonella from Shepparton in central Victoria to Perth where readers, sorry customers, were urged to get a wriggle on, and even to the nation's capital: "This is about more than just chicken," Canberra Oporto franchise owner … said. By Staff Reporters - The Canberra Times, 6 June 2025 What, no one wanted to put their name on this tour de force? Oh, and sweet-tooths, despair not, because before 'chicken day' there was also 'donut day': Celebrate National Donut Day with FREE cinni donuts thanks to Donut King Get them while they're hot. - 7NEWS (online), 5 June 2025 Hmm hmm! also saw the story's very obvious news value bringing us a National Donut Day dream getaway: Donut King collaborates with Ovolo Sydney for National Donut Day 'Hot Cinni Hotel' experience … for those who prefer their getaways on the sweet side - 23 May 2025 A resplendent pink hue bringing a touch of real class to one clever Sydney hotel which was as our correspondent faithfully reported: … taking inspiration from the famous donut in everything from the pink walls and themed pop art to the plush decor … Each room features a cinnamon donut diffuser … - 23 May 2025 Clears the sinus. But why stop there!? Turns out there are a very great number of national food days to be mined for more sparkling copy and quality programming: MONIQUE WRIGHT: … so today for world pizza day we're celebrating with the culinary classic and learning how to make pizza like an Italian chef … - Sunrise, Network Seven, 9 Feb 2025 There's also World Nutella Day on February 5, which had the scribes all a lather in Ol' Blighty. In fact, the calendar is littered with plenty of cheap excuses for plenty of cheap journalism. From a celebration of real bread, whatever that is, to meatballs, to the holiest day of the year, beer and pizza day. Now, we're all partial to a little soft serve because kittens will always need rescuing from trees and local neighbourhood heroes who pick up litter of their volition will always deserve their moment in the spotlight. But are things really so dire that we're packaging up free ads for deep fried dough and overcooked chook? Because the problem with a race to the bottom is that's where you end up.
News.com.au
4 hours ago
- News.com.au
Chris Bowen flags greater government intervention in energy markets with Gas Market Review
Labor will consider forcing gas companies to redirect future supplies into the domestic market instead of selling to international markets, with Energy Minister Chris Bowen launching a review into Australia's gas market. The Australian Competition and Consumer Commission warned on Monday Australia's east coast gas supply outlook has further deteriorated, with risks of a shortfall beginning from the fourth quarter of 2025 and into 2026 set to increase if 'Queensland LNG producers export all uncontracted gas'. This is because southern states like NSW, Victoria, South Australia and Tasmania will need to 'continually rely on gas from Queensland as their local reserves deplete,' the ACCC's interim Gas Inquiry report, published on Monday, warned. The ACCC says tipped 'structural shortfalls' on the east coast will continue from 2028 unless new gas supplies are brought online. The government's Gas Market Review will look at how regulations can be improved to ensure affordable and adequate domestic gas supply, with Mr Bowen flagging the importance of gas as a firming power, alongside renewable energy, which will make up 82 per cent of Australia's grid. However, he said existing commercial contracts with international partners will be protected. Australia is one of the world's largest liquid natural gas exporters with export earnings reaching a record $92.8bn in 2023. 'One thing we won't contemplate is ripping up existing contracts, creating sovereign risk, engaging in behaviours which will see Australia (considered) as an unreliable supply. 'We won't be doing that, but what we will be looking at is sensible, forward looking, prospective means to ensure that Australians get access to their gas.' While Mr Bowen wouldn't be drawn on whether this would mean ramping up gas supplies, or creating an East Coast Gas Reserve, he said it was a 'reasonable request' to ensure 'Australian users get access to Australian gas'. The review will also look at consolidating the Australian Domestic Gas Security Mechanism, Gas Market Code and Heads of Agreement with major east coast gas exporters to 'holistically' ensure policy can support the 'efficient supply of gas to industrial users, domestic users, and to the energy system'. Separately, Mr Bowen also commented on Adelaide's bid to host climate conference Cop31 in 2026, with negotiations at a standstill due as Turkey also pitches for the rights. The McMahon MP said while the bidding issue 'has not yet been resolved,' Australia had the support of the Western Europe Group. He also declined to give an estimated cost for the event, but said there would be 'revenue opportunities' through sponsorship and attendance fees. 'This is a remarkable opportunity for Australia. It's the world's largest trades fair,' he said. 'It gives us an opportunity to talk to the world about Australia's capacity to help them decarbonise. 'It's a remarkable opportunity for the Pacific (to) put their issues on the table. If and when we're successful, of course, we'll have more to say about costs.'
