By David Fickling | Bloomberg February 7 at 3:50 AM
Suspects are always told to put on a smart suit and a humble manner for a court appearance. It’s not so different for bankers facing public inquiries.
That’s certainly the conclusion you’d draw from the bloodbath at the top of National Australia Bank Ltd. Chief Executive Officer Andrew Thorburn will step down by the end of the month, the bank said after the market closed Thursday. Chairman Ken Henry – a former Treasury secretary and Reserve Bank of Australia board member, and still a director at market operator ASX Ltd. – will follow as soon as Thorburn’s replacement is appointed.
The immediate cause isn’t hard to discern.
In the Royal Commission inquiry into Australia’s financial sector that concluded Monday, Commissioner Kenneth Hayne singled out the pair for unusually stinging criticism. After hearing their testimony in November hearings, “I am not as confident as I would wish to be that the lessons of the past have been learned,” he wrote. “My fear – that there may be a wide gap between the public face NAB seeks to show and what it does in practice – remains.”
From the bank’s perspective, the move makes a certain amount of brutal sense. Thorburn has been in the job for almost five years, roughly the tenure of his predecessor Cameron Clyne. Given how much NAB’s share price is now lagging Australia’s other big four banks and the cloud Hayne has set over his performance, there’s little point hanging around much longer.
Although much of the “fees for no service” activity for which he was lashed happened before he started in the top role, the perceived lack of contrition clearly angered the commissioner: