Comyn Takes on Difficult Job as Commonwealth Bank's Next CEO
(Bloomberg) -- Matt Comyn has just taken on one of the most difficult jobs in corporate Australia.
The 42-year-old was Monday named chief executive officer of Commonwealth Bank of Australia, which is fighting allegations it systemically breached anti-money laundering laws and trying to restore a reputation battered by claims of mistreating customers. More bad news may be aired at a wide-ranging inquiry into bank behavior starting next month.
Comyn, who currently heads Commonwealth’s retail banking unit, will start in the top job April 9. He replaces Ian Narev, who last year announced his departure amid the fallout from allegations by Australia’s financial crimes agency that the bank breached anti-money laundering and terrorism financing laws more than 53,000 times. The bank has admitted it was late in reporting some suspicious transactions, but will contest many of the other charges.
“A surprising appointment given the internal issues Commonwealth Bank has had in recent years, of which senior executives must hold some accountability,” said Daniel Mueller, a Sydney-based portfolio manager at Vertium Asset Management Pty, which owns shares in the lender. “He has to restore the external perception of the bank. That’s easier said than done.”
The money-laundering scandal has also triggered a class-action lawsuit from disgruntled shareholders, and a separate inquiry by the nation’s securities regulator.
“The last six months have been challenging for many of us,” Comyn said at a press conference in Sydney. “I’m absolutely committed to working with the board and the executive team to address the current legal and regulatory and reputational issues that we’re facing.”
Comyn joined Commonwealth Bank in 1999 and held a variety of senior positions before leaving in 2010 to become chief executive of Morgan Stanley’s wealth business in Australia. He then returned to lead the lender’s local business banking unit, before taking charge of the retail bank in 2012.
Some investors said an internal candidate may have an easier time addressing the fallout from the money-laundering allegations and steering the bank through multiple inquiries.
“It was probably going to be difficult for an outside appointment,” Paul Xiradis, chief investment officer at Ausbil Investment Management Ltd. said by phone. “Having someone who understands and has been part of the organization is important, rather than an outsider who may have been a little bit foreign to it all.”
Comyn will be paid a base salary of A$2.2 million ($1.8 million) and be eligible for up to A$6.16 million in bonuses. Narev, who earned a base salary of A$2.65 million last year, saw his total pay drop to A$5.5 million from A$12.3 million the year before, after executive bonuses were canceled in the wake of the laundering scandal.
Narev leaves after more than six years in charge, during which he presided over a market-topping shareholder returns. In August, he delivered the bank’s eighth consecutive record profit. The bank will release first-half earnings Feb. 7
But Narev’s achievements have been overshadowed by the money-laundering allegations -- the third major public-relations scandal he faced during his tenure. The bank has paid millions in compensation to customers who were allegedly given poor financial advice, and has faced accusations it wrongly failed to honor insurance claims to sick clients.
Commonwealth Bank shares rose 0.6 percent to A$79.09 at 12:20 p.m. Sydney time Monday. The stock is down 1.6 percent this year.
©2018 Bloomberg L.P.