Suncorp likely to hunt down veteran insurer

Suncorp chief Michael Cameron’s exit and change-overs at the group’s regional bank peers have put succession planning in focus.

Outgoing Suncorp CEO and Managing Director Michael Cameron. Picture: AAP

Suncorp chief executive Michael Cameron’s exit and changeovers of chairmen at the group’s regional bank peers have put succession planning and sector consolidation back in focus.

Industry sources say while Suncorp is yet to appoint an executive headhunter to spearhead a CEO search, insurance industry experience is expected to be a key quality the board looks for.

That puts Suncorp insurance boss Gary Dransfield and finance chief Steve Johnston in the frame internally, with the latter appointed acting CEO this week.

Externally, targets are likely to include IAG finance boss Nick Hawkins and IAG head of Australia Mark Milliner and QBE Australia New Zealand chief Vivek Bhatia.

After almost four years in the top job, Mr Cameron will stay on in an advisory role until after Suncorp reports its annual results in early August.

The banking and insurance group — which houses brands including AAMI and Vero — wants to have an appointment secured later this year.

Suncorp chairman Christine McLoughlin said the board considered it “the right time” for CEO change to help the company improve performance against the backdrop of a challenging external environment.

Over at Bendigo and Adelaide Bank and Bank of Queensland, new chairmen were announced this week who will take up their respective posts in October.

BoQ — which remains without a permanent CEO — appointed Patrick Allaway to succeed Roger Davis while Jacqueline Hey will take over from longstanding Bendigo chairman Robert Johanson.

The announced moves come as the banking regulator is expected to deliver some respite to the second-tier bank sector on capital requirements in coming weeks, but the string of personnel and board changes has reignited the consolidation theme.

Bell Potter analyst TS Lim said he was “strongly in favour” of Suncorp divesting its bank.

“Bendigo Bank should buy Suncorp’s bank,” he said, noting deal possibilities existed between BoQ and Suncorp’s bank as well.

“The changing of the guard at the three regional banks should also put to rest some of the historical animosity over merger issues including share of synergies, control of the merged entity and head office domicile.”

Citigroup analysts have also been revisiting the prospects of regional bank tie-ups as housing credit growth has markedly slowed across the banking sector.

Mr Lim said he viewed a Bendigo and Suncorp bank merger as more compatible on culture geographic diversity, use of multibrand distribution channels and scale in segments such as agribusiness.

“Cross-selling (of banking and insurance products) is a thing of the past,” he added, noting Suncorp required a strong insurance leader to take the CEO reins.

Earlier this week, JP Morgan analysts pondered whether a new Suncorp CEO would stick to Mr Cameron’s strategy.

Ms McLoughlin this week said while the external operating environment remained tough Suncorp saw 2019 cash earnings being “in line” with expectations.