Matos was appointed to run the British bank’s Mexico business at the start of 2016 and was promoted to lead Europe four years later, subsequently going on to head global wealth and personal banking.
The Mexico unit had initially struggled to overcome the stain of a $US1.9 billion settlement in 2012 by HSBC with US prosecutors for failing to prevent drug cartels laundering money. By 2017, a five-year deferred prosecution agreement expired, signalling the US was satisfied with improvements at the bank.
‘The focus on domestic growth is essential, especially as ANZ currently lags its major competitors in home loan market share.’
Lisa Barrett, analyst at S&P Global Ratings
ANZ now ranks as the fourth-largest bank in Australia, with a market capitalisation of about $87 billion, having lost out recently to Commonwealth Bank, and the country’s two other major lenders, NAB and Westpac. ANZ shares initially dropped for three straight days after the announcement of Matos being hired on December 9. The stock is up about 3 per cent so far this year.
“An external appointment is important,” said Jun Bei Liu, founder and portfolio manager at Ten Cap, an investment management firm with about $1.5 billion. “It’s positive, especially for an underperforming business like ANZ.”
Earnings results last week underscored the fierce competition in lending for homes and businesses as well as turbulence arising from shifts in global trade, as ANZ extended its share buyback period citing the uncertain outlook.
“The focus on domestic growth is essential, especially as ANZ currently lags its major competitors in home loan market share,” said Lisa Barrett, analyst at S&P Global Ratings in Melbourne.
Matos outside ANZ’s Docklands headquarters, where he will start work on Monday.Credit: Aaron Francis
Matos will also have to navigate the many markets ANZ operates in outside of Australia and New Zealand. ANZ’s overseas strategy drew scrutiny in the past under another ex-HSBC executive, Mike Smith, who was penalised by investors for accumulating assets in Malaysia, Vietnam, China and Indonesia that generated poor returns.
The banking regulator — the Australian Prudential Regulation Authority — last month slammed ANZ with an additional $250 million capital requirement after an independent review unveiled weakness in the firm’s leadership and a string of poor behaviour. With that extra capital buffer taking the total for the bank to $1 billion, Matos will face the challenge of trying to get that lowered in coming months.
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“When you’ve got a regulator on your back, that’s a distraction,” Australian Shareholder Association chief executive Rachel Waterhouse, said in an interview.
“So you’d want to make sure that the organisation is responding appropriately, and you know the outcomes, and what that means.”
Meanwhile, some bankers who worked with Matos questioned his longer-term commitment to a much smaller Australian bank given the financier is known for his ambition to eventually helm a large global financial institution, some of the sources said.
Matos missed out on the top job at Europe’s largest lender to Georges Elhedery and doesn’t have extensive experience in Australia. One key task will be further integrating Suncorp’s banking arm into ANZ after the firm’s $4.9 billion purchase.
“The biggest challenges for Matos are integrating the Suncorp acquisition, while cleaning up the institutional bank issues,” said Matt Ingram, senior industry analyst at Bloomberg Intelligence in Sydney.
With Sharon Klyne and Anshuman Daga.
Bloomberg
