Acting Westpac chief Peter King moves to steady ship

Acting Westpac chief Peter King addressed the embattled bank’s senior leadership team on Monday.

Acting Westpac CEO Peter King Picture: Bloomberg

Acting Westpac chief executive Peter King addressed his senior leadership team on Monday, as the nation’s second-biggest bank continued to grapple with the crisis triggered by millions of breaches of anti-money-laundering and counter-terrorism financing laws.

Mr King spoke for about 15 minutes and took a number of questions from up to 500 people, who tuned into a webcast or attended a conference room at the Kent Street, Sydney headquarters.

Westpac’s former chief financial officer again acknowledged the scale of the bank’s problems, commented broadly on how he intended to deal with the issues, and reiterated his commitment to the chief executive’s role for as long as he was wanted.

Mr King also spent part of Monday and Tuesday visiting branches and operational centres.

In the next day or so, Westpac is expected to hear about the fate of its share purchase plan to raise $500m from retail investors.

After Austrac lodged its Federal Court statement of claim on November 20, the bank agreed to offer a withdrawal option for investors who had applied for shares.

This followed the stock plunging below the $25.32 placement price paid by large investors for the $2bn institutional placement.

Westpac determined on Tuesday that the issue price under the SPP would be $24.20, which is the lower of $25.32 or the volume average weighted price of the stock in the five days leading up December 2, less 2 per cent.

The Westpac board has kicked off a global search for a permanent chief executive, with Mr King considered likely to be a candidate.

In September, he flagged his retirement next year after a 25-year career with the bank.

His plans abruptly changed with the resignation of chief executive Brian Hartzer in the wake of the Austrac scandal.

Westpac will first have to anoint a successor to chairman Lindsay Maxsted, who has brought forward his retirement to the first half of next year.

The new chairman will have an influential role in the appointment of the bank’s CEO.

On Friday, Mr King said in a note to all staff that the board and executive team were united in their aim to deliver the response plan to the crisis with “speed, diligence and transparency”.

“We will get to the bottom of what has happened and ensure our systems are fit for purpose,” he said.

“There is just the start and there is much more to be done. I will provide regular updates on our progress.”

Westpac, he said, would remain a strong bank, with a balance sheet that was in good shape.