Westpac restructures to split consumer and business banking division

Westpac is splitting its consumer and business banking unit to ‘sharpen’ the bank’s focus and drive growth.

Westpac has split its consumer and business banking unit in two and replaced its boss with executive Jason Yetton and banking veteran Anthony Miller, in a move that will also test the pair as ­potential CEO successors.

The reshuffle to “sharpen” Westpac’s focus squarely on growth would result in Chris de Bruin leaving the bank after more than 2½ years in the role, Westpac chief executive Peter King said.

“Over the past few years we’ve simplified the bank, including exiting nine businesses,” Mr King said in a statement to the stock exchange.

As a result, the bank no longer needed a specialist businesses division, which included Westpac’s non-core businesses and had been headed by Mr Yetton.

“To sharpen our focus, we are appointing dedicated group executives responsible for consumer banking and business banking,” Mr King added.

The promotions lined Mr Yetton, who had previously led the consumer and business banking divisions from 2011 to 2015, and Mr Miller, who headed its institutional banking unit, as leading candidates for the top job in Westpac’s succession plans.

Mr King has been Westpac’s CEO since 2019, when he replaced Brian Hartzer, despite his intentions to retire after more than two decades at the bank.

With Westpac chairman John McFarlane set to depart at the end of the year, Mr King is expected to have at least a year to test the internal candidates.

Westpac CEO Peter King. Picture: Jane Dempster

“The job of the CEO and the board is to not just have the heads of the businesses to perform the best, but succession planning is a big part of it,” said a Westpac investor who asked not to be named. “Peter is probably going to be there for a while and in that time he would want to see how these two people are going to perform, and Nell Hutton is probably the next generation after that.”

Mr Miller had grown and improved the return of Westpac’s institutional business and was “well-placed to drive growth” as the new head of the business and wealth division, Mr King said.

Ms Hutton, who heads financial markets at Westpac’s institutional banking arm, will take over Mr Miller’s job as head of the unit as part of the restructure, while Scott Collary was named chief information officer.

Mr Yetton had been at Westpac for three decades, with his breadth of expertise stretching “across all facets of banking”, Mr King said.

Intense competition has seen Westpac lagging rivals, with home loan growth in the year to May coming behind major rivals Commonwealth Bank, National Australia Bank and ANZ.

At its half-year results, Mr King told investors the bank was keen to grow its book and had invested in speeding up its processing times, adding that competition remained at record highs with many banks still pricing home loans below the cost of capital.

“I want to thank Chris for his contribution to the bank,” Mr King said.

“He’s led the digitisation of the consumer bank, including the delivery of major initiatives such as the digital mortgage and payment solutions (and) also driven our branch co-location strategy and strengthened the franchise.”

The bank would establish a stand-alone function to accelerate its technology simplification, it said.

“The new structure will give the leadership team a greater focus on growing their businesses and delivering for customers,” Mr King said in a statement.

Analysts said Mr de Bruin had taken a large job in leading both divisions since he joined in 2021, and driving growth had been hard to do given the bank’s focus had been elsewhere.

Westpac’s focus in the past few years has been on its transformation and dealing with an enforceable undertaking imposed by Australian Prudential Regulatory Authority due to risk and compliance shortcomings, and not on growth.

In December 2019, APRA forced Westpac to increase its capital with an operational risk capital of an extra $1bn, which remains on the bank’s balance sheet until the regulator is satisfied that the bank has met expectations.