CEO of NZ’s Commonwealth Bank-owned ASB Bank to retire

Another senior executive is leaving CBA, with the boss of its New Zealand subsidiary, ASB Bank, to quit next year.

ASB chief Barbara Chapman.

Commonwealth Bank has announced the departure of another senior executive, with its wholly-owned New Zealand lender ASB Bank looking to replace departing long-serving chief executive Barbara Chapman.

Ms Chapman, who has steered the bank since 2011, is the latest senior executive set to quit CBA in recent months following the explosive allegations Australia’s largest bank breached anti-money laundering legislation more than 53,000 times.

ASB is the second largest bank in New Zealand, where Australia’s big four banks, as they do on this side of the Tasman, dominate the market.

The big four Australian lenders control about 90 per cent of the Kiwi market. CBA’s ASB is the second largest New Zealand lender, behind ANZ Banking Group. National Australia Bank operates under the Bank of New Zealand banner, while Westpac owns the Westpac Trust brand.

Ms Chapman will retire by Easter next year, around the same time it is expected CBA chief executive Ian Narev will depart the group. Mr Narev’s retirement was announced by chairman Catherine Livingstone just weeks after wideranging claims against the lender were filed in the Federal Court by the anti-money laundering agency Austrac.

ASB Bank operates the life insurance business Sovereign, which was last month sold to Hong Kong-based AIA Group as part of the $3.8 billion sale of CommInsure. CBA has also put its global asset management arm up for review ahead of a potential sale or float.

Ms Chapman said being ASB chief executive has been the highlight of her career, and she is now “excited to be able to take some time to think about areas of future interest and challenge”. ASB is looking for a replacement.

ASB chairman Gavin Walker said Ms Chapman had been a “passionate and effective” chief executive and had played a key role in the bank, lifting annual profit from $NZ568 million in 2011 to over $NZ1 billion in the most recent financial year-end.

CBA is facing questions from New Zealand regulators as its 2013 rollout of its smart ATM network allowed its customers to deposit under $10,000 without identification. CBA’s intelligent deposits machines are at the centre of the money laundering and terrorism financing allegations, as they failed to properly report transactions to the regulator.

Along with the departure of Mr Narev, the bank’s head of wealth management Annabel Spring has also flagged her departure from the bank. Non-executive directors Harrison Young and Launa Inman will retire after CBA’s November annual meeting, while non-executive director Andrew Mohl, a former CEO of AMP, to step down a year later.

The CBA’s New Zealand earnings in the year to June 30 were boosted by a 13 per cent gain in ASB Bank’s cash profit, as the kiwi lender benefited from smaller charges on bad debt and stripped out costs to keep on top of shrinking interest margins.

ASB’s cash profit, lenders’ favoured earnings measure, rose to $NZ1.03bn from $NZ914m a year earlier. Net profit, which includes unrealised movements in the value of financial instruments, jumped 17 per cent to $NZ1.07b.

CBA acquired a 75 per cent shareholding in ASB in 1989 and bought the rest in 2000.

With AAP