New Westpac CEO Anthony Miller bets on tech, business boost

Wealth and business banking boss Anthony Miller will continue Westpac’s technology and risk transition plans when he takes over the top job from Peter King in December.

Westpac has appointed Anthony Miller as its new CEO replacing Peter King who has led the big four bank for the last five years. Picture: Jane Dempster

Westpac’s incoming boss Anthony Miller is vowing a shift of the retail bank’s focus beyond mortgages, as he doubles down on business lending, the institutional unit and steering a technology transformation.

On Monday Westpac told investors Mr Miller would be the next chief executive, replacing Peter King, who took on the running of the lender in April 2020.

Mr Miller, who has until recently run Westpac’s business and wealth business, said he was “ambitious” for the future of the lender ahead of his start on December 16, noting he would charge forward with a massive technology roll-up outlined by Mr King in March.

This will see Westpac slash up to 100 different systems from its tech stack by 2028, leaving just 60 distinct systems.

Mr Miller said the simplification program, dubbed “Unite”, was “so profoundly important for the company”.

The investment, expected to represent almost 30 per cent of Westpac’s total investment spend, comes after years of bloated technology operations amid acquisitions including notably rival lender St George in December 2008.

Mr Miller said Unite also gave Westpac an opportunity to grow its business banking division amid rampant competition in home lending that was driving down profitability.

Atlas Funds Management chief investment officer Hugh Dive said many people in the market had expected Westpac’s consumer banking boss Jason Yetton would get the top job.

He said it was likely Mr Miller’s appointment would trigger a number of departures from Westpac, but said this depended on “job openings for those that missed out”.

“Ultimately it doesn’t make a massive difference,” he said.

“A large bank has lots of layers of quite competent people and a protected oligopoly.”

Westpac revealed a $1.8bn net profit in August, with the lender revealing housing loan growth up 8 per cent outperforming rivals.

Mr Miller said competition in business banking was “as fierce as it’s ever been”, noting Westpac had to deliver “consistency and quality”.

The former investment banker is also targeting better earnings from the institutional bank, amid poor returns from home lending after a price fight between rival lenders.

“We see a lot of upside in what we can achieve in institutional banking and business banking, and they’re both businesses that Westpac was or has a fabulous legacy in,” he said.

“We just want to obviously continue to sort of challenge those businesses to return to where they were in the past.”

But Mr Miller said Westpac also had to grow its business in a “safe and sustainable way”.

Westpac has seen a series of upsets from its business lending, including a lease-lending scandal around the Sydney-based asset financing operation Forum Group which allegedly engaged in a years-long fraud that saw the bank book a $200m charge.

Sydney property developer Jean Nassif and his daughter secured a $150m credit approval from Westpac, for Toplace’s Skyview residential complex in Castle Hill using “fake” documents.

Mr Miller said he now had to manage the transition to his formal takeover after the Westpac annual general meeting on December 13 in Sydney.

UBS analysts John Storey said Mr Miller landing the top job was a “positive outcome”, noting he allowed for continuity as well as a “strategic pivot”.

“Westpac has been internally focused for the past number of years but over the past 12-months the bank seems to be carrying some level of operational momentum,” he said.

“Immediate challenges (first 100 days) for the new CEO will be to retain and embed key members his of executive leadership team, and prioritising or adding to Westpac’s current strategic priorities.”

Westpac's new CEO Anthony Miller with chair Steven Gregg.

But Mr Storey highlighted “a hole in Miller’s resume”, noting his lack of retail banking experience.

Mr Miller also faces attempting to hack away at a $500m capital buffer still sitting on the bank’s books after the Australian Prudential Regulation Authority punished the lender over risk failings.

Austrac slammed Westpac in 2020 when the financial crimes regulator issued a $1.3bn fine over failures to oversee $11bn in transfers, some of which went to child exploiters.

APRA has already slashed $500m from Westpac’s capital burden, but the remainder requires the regulator to sign off on the bank’s transformation.

The latest IBM report into Westpac’s risk and governance remediations found the bank had made “substantial progress” towards rooting out its problems, but noted the bank faced a challenge “to maintain momentum and ensure that the outcomes of the Program continue operating effectively, sustainably and in an interconnected manner”.

Mr Miller said Westpac was four years into a six year transformation.

“It’s my job now to sort of accelerate the performance aspect of that,” he said.

Mr King said the “time is not the right lens to look through” on the changes he had sought to push through at Westpac.

“We’re now in the phase which is proving to our regulators that the changes have stuck,” he said.

Westpac chair Steven Gregg paid tribute to Mr King, who somewhat unwillingly took on the job in April 2020, succeeding Brian Hartzer, and has tried to retire previously.

Mr King said he was “done”, noting he had “achieved what I needed to do” as CEO.

Since taking on the top job shares in Westpac have surged more than 109 per cent, from their lows of $15.22 in April 2020 to close at $31.87 on Monday, down 0.72 per cent or 23c amid a weak market.

“Since then, Peter has provided much needed stability to the bank while transforming risk management,” Mr Gregg said.

Mr Miller will be paid $2.5m, the same package as Mr King, inclusive of superannuation and salary sacrifice arrangements.

Mr Gregg said the new CEO was the right person to take on the most demanding job at the bank, noting he was an “exceptional leader” and an “individual of integrity”.

The career banker previously led Deutsche Bank Australia and New Zealand as CEO.

The move to replace Mr King comes soon after NAB’s veteran CEO Ross McEwan stepped down, leaving CBA and ANZ the last of the big four banks to announce leadership transitions.

Originally published as New Westpac CEO Anthony Miller bets on tech, business boost