ANZ’s former CEO is suing the bank after he was stripped of a $13.5 million bonus.
Former Australia and New Zealand Banking Group (ANZ) CEO Shayne Elliot has launched legal action against the major bank after it withheld $13.5 million in bonuses.
Elliott, who retired from his role in May, was among the group of current and former ANZ executives who had their bonuses withheld after the major agreed to pay a record fine of $240 million to the Australian Securities and Investments Commission (ASIC), following allegations of multiple compliance failures during his tenure as CEO.
The former CEO filed his action in the Supreme Court of NSW on Thursday (11 December).
ANZ acknowledged the proceedings in a statement released on Friday (12 December), noting requirements to “design remuneration in a way that encourages prudent risk management as well as linking executive pay to performance and risk outcomes”, under the Australian Prudential Regulation Authority’s Prudential Standard CPS 511.
It also noted the board had determined that no Australia-based group executive – except those in acting roles – would receive short-term variable remuneration, and the long-term incentives scheduled to be awarded to Elliott had been reduced to zero for 2025 and 2026.
In November, the major bank’s latest annual report showed that neither Elliott nor his successor, Nuno Matos, received a short-term bonus for 2025.
ANZ chairman Paul O’Sullivan commented on the action in the bank’s statement.
“The board has been considered and very deliberate in its assessment of remuneration outcomes,” he said.
“We are confident in our position, and we will defend this matter vigorously.”
Penalties for misconduct
In September, ANZ confirmed it had agreed to pay a penalty of $240 million covering four different investigations into the bank and linked to misconduct over several years.
The penalty included $125 million for institutional and market matters, $80 million penalty for unconscionable conduct, and $115 million in total penalties for three retail matters.
During a press conference held at the time of the announcement, Australian Securities and Investment Commission (ASIC) chair Joe Longo said the lender has had a “history of non-compliance in market matters, for misconduct in foreign exchange, continuous disclosure, and the bank bill swap rate matter”.
“The issues we have found in the bank’s different divisions are a mix of widespread misconduct, repeated failures, and an unacceptable disregard for the trust customers put in banks,” he added.
At the time, O’Sullivan acknowledged that the bank had “made mistakes that have had a significant impact on customers”.
“On behalf of ANZ, I apologise and assure our customers we have taken the necessary action, including holding relevant executives accountable,” O’Sullivan said.
ANZ’s current CEO, Nuno Matos, added: “The failings outlined are simply not good enough and they reinforce the case for change.”
“It is my expectation that we see measurable improvements across the bank to better protect and care for our customers and to create a more sustainable business.”
Period of change
This latest development comes at the end of a year of change for the lender.
In an October update to investors, Matos outlined five immediate priorities, including embedding ANZ’s new leadership team, speeding up the integration of Suncorp Bank, rolling out ANZ Plus to all retail and small-business customers, simplifying operations by cutting duplication and winding back initiatives that do not align with the bank’s strategic direction.
“Under these changes, we will unlock our potential to win the preference of customers, shareholders and the community,” he said.
“Under our new strategy, customers are at the centre of everything we do – whether it’s improving their experiences, offering them leading technologies and platforms, or keeping them safe.”
“Our first focus is to get back to basics and deliver our immediate priorities, while our four strategic pillars will then accelerate our revenue growth and see all four divisions perform to their full potential.”
[Related: ANZ agrees to $240m fine for misconduct]
