SYDNEY • Australian banking giant ANZ's chief executive Mike Smith, who oversaw a big push into Asia, said he was stepping down yesterday after eight years in the top job.
England-born Mr Smith will be replaced by chief financial officer Shayne Elliott on Jan 1 next year but will serve as a non-executive adviser to the Australia and New Zealand Banking Group's board for at least a year due to his "invaluable understanding of and connections in Asia", the bank said.
Chairman David Gonski praised Mr Smith for his efforts in steering the company - which has a market capitalisation of A$78.1 billion (S$78.2 billion) - through the global financial crisis and for transforming "ANZ into one of Asia-Pacific's leading banks".
"Mike has been a champion of ANZ and of Australia globally but particularly in Asia," Mr Gonski said in a statement.
New Zealander Mr Elliott, who previously held senior positions at Egypt-headquartered investment bank EFG-Hermes and American firm Citibank, was chosen after a detailed review of candidates.
The incoming CEO said the bank was committed to seeking growth in Asia but flagged more discipline in implementing its strategy - one that has come under fire for its low returns.
Mr Smith started the bank's "super regional" strategy in 2007, making it the only major Australian bank to focus on Asia. Although he initially gained plaudits, investors have become impatient with the region's high costs and weak returns, especially when compared with a lucrative domestic market.
"The opportunity remains valid, but the way we operate has to change," Mr Elliott told an investor briefing. "We need to kind of re-address our focus on capital discipline and allocation of resources."
The appointment saw ANZ shares climb 1.6 per cent, in line with the broader market. The stock has, however, underperformed this year, falling 15 per cent compared with 9 per cent declines each for Westpac Banking Corp and National Australia Bank.
"(Elliott's comment) shows a commitment to fix the issue but Asia is a difficult market, so it's questionable what can actually be done and at what cost," said Mr Omkar Joshi from Watermark Funds Management.
ANZ has invested in 15 Asian countries where it focuses on cash management, foreign exchange and debt markets.
Last month, it opened a new branch in China and will open its first branch in Myanmar today.
REUTERS, AGENCE FRANCE-PRESSE