New chairman John McFarlane the tough operator Westpac needs

John McFarlane showed himself in the UK to be a tough operator. Picture: Bloomberg.

John McFarlane’s appointment as Westpac chair has received mixed reviews, with an expectation that he will be in the job for a relatively short period of two years, and be a hands-on chair.

His key appointment is obviously the next chief executive, with former CFO Peter King as the standout internal candidate.

In the short term McFarlane undoubtedly brings gravitas, experience and style to the position, which will meet regulator and stakeholder expectations.

In his time as a non-executive in the UK he showed himself to be a tough operator, which is precisely what the bank needs right now.

He joins a board which includes former colleague, ANZ CFO Peter Marriott, who is a close ally and firms as a favourite to be the long-term chair of the bank.

In his executive days, running ANZ for 10 years to 2007, the market will remember a long-running duel with then chair Charles Goode over the length of his term. Goode wanted him to finish sooner rather than later, but McFarlane won the argument.

John McFarlane, as ANZ CEO in 2006.

When he returned to Australia last year McFarlane, 72, made clear he was keen to retire and anxious not to follow in the footsteps of many of his family, who died relatively young.

The challenge of this position seems to have convinced him to have one more ride in the saddle.

A former senior Citibank executive, McFarlane was a derivatives expert and is a different style of banker to the old school types at the helm of NAB - Philip Chronican and Ross McEwan.

But the new era is one of bringing back old timers to steady the ship and in John McFarlane Westpac has a safe pair of hands.