Blood-letting continues for CBA’s executive team

More senior executives will leave the Commonwealth Bank in the wake of the money laundering scandal.

Incoming CBA CEO Matt Comyn in Sydney. Picture: James Croucher

The executive overhaul at Commonwealth Bank continues apace in the wake of the money laundering scandal, as the group’s institutional boss and technology head both flag their departure while incoming chief Matt Comyn puts his stamp on the executive team.

CBA yesterday announced the departures of Kelly Bayer Rosmarin, chief executive of the institutional bank, and David Whiteing, chief information officer, who will both leave “in the coming months”. Ms Rosmarin is understood to have competed with Mr Comyn for the chief executive role, which was announced earlier this year.

Melanie Laing, group executive of human resources, also will leave the nation’s largest bank.

The shake-up comes as Mr Comyn prepares to take over on April 9 from chief Ian Narev, whose retirement was announced following the explosive Austrac legal suit in August last year.

“Leadership transitions are inevitably a time of change in senior teams, as executives reassess their own plans, and the bank prepares for its future,” Mr Narev said.

Mr Comyn said he was ­“focused” on building an executive team that would “exceed the expectations of our customers, the community and regulators; rebuild the trust and pride in our bank; and enhance the financial wellbeing of every customer”.

The departures add to the ­exodus of senior management at the bank in recent months. The bank has shed half of its 13-person strong executive team. Earlier this month long-serving board director Brian Long had his exit flagged, while non-executive directors Harrison Young and Launa Inman stepped down from the board last November.

The bank’s head of wealth management, Annabel Spring, also left the bank, along with Barbara Chapman, the chief executive of the bank’s wholly owned New Zealand lender.

Mr Comyn said he had begun a search to fill the vacancies, as well as the appointment of a retail chief position, which will be left vacant when he takes over as boss.

CBA late last week said it would be heading to mediation with the anti-money laundering agency Austrac, in what could potentially lead to a settlement of the landmark Federal Court case.

Austrac last August sued the bank, claiming more than 50,000 breaches of anti-money-laundering and counter-terrorism-financing legislation.

The bank did not send the regulator thousands of legally required reports for transactions that were made through the company’s intelligent deposit machines. Austrac claimed the machines did not go through rigorous compliance testing before and during the smart ATM rollout from 2012 onwards.

The Federal Court case will examine whether CBA’s transaction surveillance IT systems were adequate at identifying structured deposits being made across dozens of branches, as money laundering syndicates tried to avoid mandatory reporting thresholds.

The bank’s audit and risk committee is being investigated by the Australian Prudential Regulation Authority as part of an inquiry into CBA’s governance and culture.

While CBA has admitted to some of Austrac’s claims, the bank previously said it would defend itself against numerous allegations in court.

The bank also flagged its intention to fight a class action launched by Maurice Blackburn over the affair.

In the first sign that the parties could avoid protracted and costly litigation, CBA last week announced that orders were made in the Federal Court for the matter to be referred to mediation before May 25.

The Austrac allegations have had far-reaching consequences for CBA, with new chairman Catherine Livingstone slashing senior management bonuses and activating the succession plan to replace chief executive Ian Narev.

In a separate Federal Court case, the Australian Securities & Investments Commission in January launched a suit accusing CBA of rigging or attempting to rig the BBSW six times in 2012.

ANZ and NAB settled their rate-rigging cases in November. However, Westpac fought the regulator through to trial in the Federal Court, and is awaiting judgment.