NAB CEO Andrew Thorburn and chairman Ken Henry quit

Marco Green
February 8, 2019

National Australia Bank's chief executive officer, Andrew Thorburn, and chairman, Ken Henry, have announced they will quit the bank after their leadership was criticised by the royal commission.

On Tuesday Thorburn had signalled he meant to dig in, saying he was "more determined than ever" to lead the bank, despite Hayne's criticism.

Henry's resignation came as no surprise after he endured sustained disparagement following a televised appearance in which was castigated for a "contemptuous" response to the Commission's report.

He said the board should have the opportunity to appoint a new chair as NAB "seeks to reset its culture and ensure all decisions are made on behalf of customers". I have always sought to act in the best interests of the bank and customers and I know that I have always acted with integrity.

'However, I recognise there is a desire for change.

Thorburn said he had offered to step down and the board had accepted.

Philip Chronican, a current NAB director with extensive domestic banking experience, will serve as acting chief executive from March 1 until a permanent appointment is made.

Mr Chronican said it had been an "extraordinarily hard week for everyone involved", but the board would now launch a global search for a chief executive.

"I certainly could have and should have done a better job", he said, explaining that after reviewing his evidence he was "quite upset" about his performance.

The commission's final report earlier this week named the two as standing out from their peers by appearing unable to learn from their mistakes.

The leadership upheaval comes after NAB suffered a horror year in 2018, with the royal commission exposing the fees for no service scandal, questions over alleged rorts by Mr Thorburn's chief of staff, a bribery ring in the bank's mortgage business and a record-breaking shareholder revolt against the bank's executive pay report.

Mr Le Mesurier said investors should remain wary of NAB stocks.

"Having heard from both the CEO Mr Thorburn, and the chair Dr Henry, I am not as confident as I would wish to be that the lessons of the past have been learned", Hayne wrote.

Dr Henry, a former head of Treasury who had been chairman since 2015, said the bank was on the right path to turning things around but still had an "absolute mountain to climb".

"Andrew and I are deeply sorry for our inability to do that and that's principally what has driven the decisions that have been taken today", he said.

"The timing of my departure will minimise disruption for customers, employees and shareholders".

Dr Henry said he has reflected in recent times on NAB's "inability as a company to meet community expectations and customer expectations in the manner we would aspire to". "For that, we're deeply sorry".

Hayne's criticism of NAB was searing. I thought it telling that Dr Henry seemed unwilling to accept any criticism of how the board had dealt with some issues.

Since replacing Cameron Clyne as CEO, Mr Thorburn had overseen the divestment of the bank's unprofitable Clydesdale Bank and 80 per cent of its MLC wealth management business, and embarked upon a $1.5 billion restructure that will trim 4000 jobs over three years.

He said he believed he was leaving NAB in better shape than he found it.

Other reports by Click Lancashire

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