BNZ’s Angela Mentis revealed as New Zealand’s highest paid bank boss
Bank of New Zealand’s new chief executive Angela Mentis had the highest statutory pay packet of the New Zealand bank chiefs this year, edging out ANZ boss David Hisco who runs New Zealand’s largest bank.
She received statutory remuneration of $3.8 million (A$3.57m), according to the bank’s annual report.
That was higher than Hisco’s $3.76m (A$3.53m) despite ANZ New Zealand’s profit of nearly $2b being almost double that of the BNZ.
Mentis moved over from BNZ parent National Australia Bank to take up the top job at the start of the year, meaning three months of her pay package was for her previous role as chief customer officer business and private banking.
But her move to New Zealand seems to have done little to damage her earning power, with Mentis the third highest-paid executive still working for the NAB group behind chief executive Andrew Thorburn and chief technology officer Patrick Wright.
Thorburn, a previous BNZ CEO, received total statutory remuneration of A$6.39 million for the year to September 30.
Thorburn’s variable reward was reduced by the board so he received A$3.03 million less than his target total remuneration for 2018.
Other executives, including Mentis, also had their variable rewards reduced by between 17.5 per cent and 105 per cent of target with 60 per cent of variable rewards deferred in shares and restricted until 2022 to drive long-term decision making.
A BNZ spokesman said the CEO’s salary was set by the board, whick looked at individual performance, skills, experience, capability and market data.
“The salary reflects the huge complexity of the role in a changing and dynamic environment.”
Banks have come under heavy fire from Australia’s Royal Com- mission for their short-term focus on profits and for rewarding executives based on that.
In New Zealand, the Financial Markets Authority and Reserve Bank have called for incentive pay to better reflect good customer outcomes all the way to the executive level including a call to ban sales incentives for frontline staff and managers. In the annual report, Anne Loveridge, NAB’s remuneration committee chair, said it accepted that traditional incentive schemes had contributed to a focus on short-term, financial outcomes in the sector.
“This does not best serve the interest of customers, shareholders or NAB itself.”
This year the bank had introduced a new pay framework to encourage long-term decision making to drive performance that represented the interests of all of the bank’s shareholders.
All staff now had a balanced scorecard performance plan with compulsory customer and risk measures, she added.
Loveridge said the board considered that customer, risk and reputation matters, many of which had feature in the Royal Commission, “should have been dealt with better and faster”.
“The board considers that the executive leadership team needs to do more, individually and collectively, to ensure that NAB always ‘does the right thing’ by its customers.
Meanwhile Westpac New Zealand chief executive David McLean received statutory remuneration worth $2.42m (A$2.27m).
New ASB bank chief executive Vittoria Shortt’s pay package was also high despite it only including her time in her previous role at Commonwealth Bank of Australia.
Shortt earned nearly $2.9m in total remuneration during the seven months before she stepped up to lead the local branch of the bank in February.
Shortt, who moved from a group executive role at the Commonwealth Bank of Australia to head up the ASB bank, earned A$2.7m ($2.88m) between July and February when she jumped the Tasman to take on the current job. That pay packet — which a spokesman said did not include what she was paid for her part-year at ASB — was more than double her total statutory remuneration of A$1.38m in the 12 months to June 2017, CBA’s annual report reveals.
A large part of Shortt’s 2018 package was a A$2.12m share-based payment from a long-term variable remuneration reward right.
An ASB spokesman said that included deferred incentives, which will vest between 2019 and 2022. They are at risk and subject to performance conditions, he said.
Outside of that Shortt’s base pay took a cut, falling from A$1.03m to A$519,611.