Finance Finance News Banking John McFarlane named new chairman of scandal-hit Westpac

John McFarlane named new chairman of scandal-hit Westpac

Former ANZ boss John McFarlane has been named Westpac chairman-elect as the latter bank tries to recover from a money-laundering scandal. Photo: AAP
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Westpac has named veteran banker John McFarlane as its next chairman as it confronts the fallout from a massive money laundering scandal revealed last November.

Mr McFarlane is a former chief executive of the ANZ Bank and was chairman of British bank Barclays until May last year.

More than 23 million suspected breaches of anti-money laundering laws, brought by the financial intelligence agency AUSTRAC, forced the resignation of Westpac chief executive Brian Hartzer and prompted current chairman Lindsay Maxsted to bring forward his retirement.

In a statement to the ASX, Mr Maxsted said his successor’s 44 years’ experience would be invaluable as Westpac responds to the money laundering scandal, where its payment platforms were used by convicted paedophiles for transactions in the Philippines.

“Over the past 27 years, he has been a main board director of five of the world’s leading financial institutions, including as executive and non-executive chairman, chief executive and executive and non-executive director roles,” Mr Maxsted said.

“Most recently, Mr McFarlane was chairman at Barclays in London, which after the global financial crisis underwent a decade of challenge.

“During his four years as chairman, the company was streamlined, repositioned and has sustainably returned to profit.”

Mr McFarlane confirmed he had not intended to take another banking leadership role but was “excited by the challenge of returning Westpac to its place as a leading global bank, following recent events”.

“To some extent, the internal and external challenges ahead for Westpac are not dissimilar to those in my last five financial institutions.

“Nevertheless, I’m sufficiently battle-hardened to realise things can be tougher than you think and that in banking, nothing is ever certain.”

Mr McFarlane will return to live in Australia permanently and will begin as a non-executive director in February, subject to regulatory approvals.

In addition to managing the fallout from the money laundering scandal, Mr McFarlane will work closely with acting chief executive Peter King to oversee the search for a new chief executive to replace Mr Hartzer.

Mr McFarlane was ANZ chief executive between 1997 and 2007 and chairman of Barclays from 2015 to 2019.

He carved a reputation as a straight-talking, folk-singing Scotsman during his time at ANZ and in 2007 conceded that Australia’s big banks were taking too much money from consumers through penalty fees on credit cards.

The appointment of a new chairman has been highly anticipated in the wake of the money laundering scandal and Mr McFarlane is seen as a critical change agent in rebuilding Westpac’s battered reputation.