NAB boss hasn’t engaged with board after ‘difficult’ week

National Australia Bank chief executive Andrew Irvine says he has not engaged with the board about investors reportedly raising concerns over his management style and drinking at client events, and he did not attend an informal meeting about the issue last week because it was 3am where he was.

The NAB boss, who was on holidays overseas when reports were published last week, also said he would not change the amount of time he spends with customers, and that the public scrutiny had been hard on him and his family.

“I’ve just got to get through it”: NAB chief executive Andrew Irvine.Credit: Oscar Colman

Irvine was speaking at a conference put on by the Australian Banking Association, which he chairs, when he made his first public comments addressing the issue on Wednesday.

“Last week was difficult, I’m not going to beat around the bush, especially when media is quite personal and public. So it was hard for me and for my family,” Irvine said to outgoing ABA chief executive Anna Bligh, who is a former premier of Queensland.

“I expect that there’s public scrutiny in roles like this, you just hope that it’s even-handed and balanced as you kind of go through it. I’m sure you’ve experienced this as a politician in the past and many public figures will experience media,” he said. “I’ve just got to get through it.

“I love the job that I do. It’s a real privilege to run the National Australia Bank. There’s a real noble purpose in what we do – helping people navigate their financial lives – and that gives me energy.”

The Australian Financial Review reported last week that major investors had raised concerns about Irvine’s management style and drinking at customer meetings and events with the bank’s directors.

The report said the issues about his management approach were raised with NAB chairman Phil Chronican at an investor lunch in Sydney last month, citing unnamed sources.

The AFR also reported last week that NAB directors had informally met last week to discuss public perceptions of the comments made about Irvine at the Sydney lunch in June, following the reports. It said directors agreed they would urge Irvine to “smarten up” in terms of his presentation.

National Australia Bank CEO Andrew Irvine and Australian Banking Association CEO Anna Bligh at the ABA conference in Darling Harbour, Sydney.Credit: Sitthixay Ditthavong

On Wednesday, Irvine said he had been invited to this meeting but chose not to attend because it was held at 3am where he was. He described the meeting as “an informal conversation to try and get the facts … around what was being said and whether the board felt it was fair and warranted.”

He said he had not spoken to the board about its reported intervention.

“I haven’t yet had any conversations on that topic yet, so we’ll see,” Irvine said.

Speaking to journalists after the panel on Wednesday, Irvine said he would continue to spend time with bank customers, adding that this helped customers understand how the bank provided support, which often led to more business.

The bank has had a number of high-profile departures, including former business banking boss Rachel Slade.Credit: Natalie Boog

“So I’m not going to change the amount of time I spend with customers. It’s a really important part of who I am and what I want the rest of our staff to be doing.”

When asked if it was appropriate to have a couple of glasses of wine or a few drinks with clients at lunch, Irvine replied: “I very rarely go out for lunch with customers.”

Last week, the bank published a statement backing Irvine. “Andrew Irvine and the NAB leadership team are delivering sound financial and operational results … the board’s support for Andrew and his team is unchanged,” a spokeswoman for NAB said last week.

Last financial year Irvine received $1.74 million remuneration, though he was chief executive for only roughly half the period.

The scrutiny follows several senior departures at NAB this year, including finance chief Nathan Goonan, who moved to Westpac, and former business banking boss Rachel Slade.

Slade, who was running NAB’s biggest division and had been seen as a chief executive contender before Irvine’s appointment last year, was replaced by Irvine’s former Bank of Montreal colleague Andrew Auerbach.

MST Marquee analyst Brian Johnson said this week that he thought the concerns about NAB’s management were overdone compared with the challenges facing new chief executives at Westpac and ANZ, Anthony Miller and Nuno Matos, respectively.

“The recent media conflation of a casual criticism to an existential crisis is a little farfetched!” Johnson wrote in a note to clients on Monday.

Johnson said NAB had two fundamental shortcomings compared with CBA: over-reliance on mortgage brokers, and a “lagging deposit franchise”. He also said that Irvine had called out both of these issues as strategic objectives.

“Improving both these dynamics without resorting to shareholder value destructive pricing on a sustainable basis will be the gauge of success or otherwise for Irvine,” Johnson wrote.

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