Australia's top lender, National Australia Bank, announced on Thursday the impending exit of its chief executive, a week after he shocked investors with another A$830 million ($784 million) in loan losses.
The bank named the head of its Bank of New Zealand unit, Cameron Clyne, as its next chief executive, replacing John Stewart from January 1, 2009.
The announcement came just six days after the bank said it was taking more bad-debt charges to cover losses on its exposure to U.S. mortgages, taking its total provisions this year on collateralised debt obligations to more than A$1 billion.
"Given NAB's track record of slip-ups, an external appointment who came in with a clean slate and no incumbency may have had its merits," said Mark Nathan, a portfolio manager at Fortis Investment Partners.
"But Cameron's certainly done a good job in New Zealand, and taken a differentiated strategy which has been reasonably successful," Nathan said. "It's now a matter of whether he rises to the challenge."
While Stewart said last Friday the bank's underlying businesses were not showing signs of stress, analysts warned the bank might have to set aside even more funds as it was exposed to A$4.5 billion in other asset-backed securities.
NAB Chairman Michael Chaney said Clyne's appointment represented the culmination of extensive succession planning over the last 18 months, including an international search.
"Cameron Clyne is an outstanding executive with the strategic, cultural and leadership qualities that fit the business at this time," Chaney said.
Clyne has led NAB's New Zealand arm since March 2007 after serving for two years as executive general manager of group development. He came to NAB from PricewaterhouseCoopers where he was managing partner for its Asia-Pacific financial services consulting practice.
Among those considered front-runners for the top job at NAB were Ahmed Fahour, head of the group's biggest operation, the local Australian business. A report this week said he had also been on the shortlist to lead Australia's top airline, Qantas Airways, which named a new chief on Monday.
NAB's chief financial officer, Mark Joiner, had also been tipped as a candidate.
NAB also announced that Andrew Thorburn will take over the helm of the New Zealand business from October 1, subject to regulatory approval. Thorburn currently runs NAB's retail bank in Australia, and the bank said his replacement would be announced in due course. All senior executives running other NAB divisions would remain in their current roles, it added.