CBA chief to retire amid money-laundering scandal

SYDNEY: Commonwealth Bank of Australia (CBA) CEO Ian Narev ( pix) will retire by next June, Australia’s No. 2 lender said yesterday, after a week of damaging publicity about a money-laundering lawsuit led to calls for the longserving chief to resign.

Narev, 50, would be gone by the end of the current financial year after almost seven years in the job, a tenure marked as much by record profits as allegations of serious misconduct including insurance scams and poor financial advice.

CBA chairwoman Catherine Livingstone said Narev’s departure had nothing to do with the latest scandal, allegations by the financial intelligence agency that criminals and terror financiers laundered millions of dollars through CBA accounts.

The case is the first lawsuit of its kind against a major Australian bank and could expose CBA to the largest fine in Australian corporate history, amounting to billions of dollars.

Narev has blamed a coding error for most of the breaches and CBA says it will defend the case.

“This statement has not been rushed,” Livingstone told journalists, referring to the timing of Narev’s retirement announcement amid daily negative headlines for the bank.

Investors have been rattled by the third misconduct scandal under Narev’s watch. CBA shares have fallen 3.7%, wiping nearly A$5 billion (RM16.96 billion) off its market value, since the AUSTRAC agency filed its lawsuit on Aug. 3.

A better-than-expected 4.6% rise in annual profit to A$9.88 billion, posted on Aug 9, failed to appease investors’ concerns. It was the bank’s eighth straight record cash profit. – Reuters