Time will tell story of CBA’s choice

NewsMail - - NEWS - TERRY McCRANN Her­ald Sun busi­ness as­so­ci­ate edi­tor

AT AL­MOST any point in the Com­mon­wealth Bank’s 106-year his­tory, the el­e­va­tion of 42-year-old ris­ing star Matt Comyn to the top job would have been not sim­ply un­con­tro­ver­sial but uni­ver­sally ac­claimed.

The CBA is Aus­tralia’s big­gest and most prof­itable bank and in re­cent times also eas­ily the most suc­cess­ful.

A huge part of that has been the ba­sic re­tail bank – the part that deals with you and me – which Comyn has run since 2012.

If any­one was the “nat­u­ral suc­ces­sor” to dy­namic CEO Ian Narev, it was Comyn.

Un­til Au­gust 3 last year to be ex­act. That was the day the news of CBA’s 53,700-odd al­leged money laun­der­ing in­frac­tions ex­ploded into the pub­lic arena.

The CBA, Narev and his pre­de­ces­sor, Ralph Nor­ris, had emerged seem­ingly un­scathed from a se­ries of, to use a neu­tral term, “cus­tomer is­sues” – Storm Fi­nan­cial, Com­mIn­sure, fi­nan­cial plan­ning rip-offs and so on.

But AUSTRAC’s money laun­der­ing al­le­ga­tions seemed to fi­nally snap the twig – to cut through.

Sud­denly, “ev­ery­thing” changed, in re­la­tion to the CBA, the position of its CEO and the four big banks more broadly.

On Au­gust 2, Narev was rid­ing high and looked set in in his near $10 mil­lion job for some years yet. On Au­gust 4 he was head­ing for the door and re­cently ap­pointed chair­man Cather­ine Liv­ing­stone started the search for a new co-leader.

More broadly, the CBA would find it­self in the unique, and hu­mil­i­at­ing, position of hav­ing an APRA ini­ti­ated in­quiry into its “cul­ture” – read failed or toxic cul­ture.

The CBA and its big bank peers were then also ir­re­sistibly headed for the first royal com­mis­sion into banking in Aus­tralia in 80 years.

Thank you very much, pal, (other) bank CEOs could well have mut­tered.

That makes Mon­day’s ap­point­ment at the very least “coura­geous” – in the nor­mal sense of the word and the

Yes, Prime Min­is­ter ver­sion. For Comyn is not just any old “CBA in­sider”, but in com­par­i­son with his peers the ul­ti­mate in­sider. Apart from one very brief mid­ca­reer move out­side, he’s been with the CBA al­most his en­tire work­ing life.

If “cul­ture” is the prob­lem, it seems at least coun­ter­in­tu­itive to se­lect some­one to lead the bank through the com­ing reg­u­la­tory and po­ten­tially sem­i­nal struc­tural tur­moil – some­one who is not only steeped in that cul­ture but has self-ev­i­dently been a ma­jor, se­nior ex­ec­u­tive con­trib­u­tor to cre­at­ing it.

Clearly, the chair­man does not agree. She told me there were as­pects of the CBA’s cul­ture that were neg­a­tive but there were as­pects that were pos­i­tive.

Her ex­pla­na­tion for the Comyn se­lec­tion is that he is the best per­son to sus­tain the mo­men­tum of the, to para­phrase, “good cul­ture”.

To my mind there are two ways to look at both the ap­point­ment and the Liv­ing­stone ex­pla­na­tion.

One is that both chair­man and board just don’t get it – that you can’t dis­ag­gre­gate “cul­ture”.

The other way is that the chair­man and board have ac­tu­ally man­aged to po­ten­tially suc­cess­fully merge the two con­flict­ing el­e­ments of the com­plex chal­lenge they were pre­sented with – how to deal with all those “is­sues” with­out at the same time crip­pling the bank’s per­for­mance.

We shall see.

Newspapers in English

Newspapers from Australia

© PressReader. All rights reserved.