(Dec 12): The former chief executive officer of ANZ Group Holdings Ltd has taken the bank to court for millions of dollars in bonuses which were withheld over scandals that emerged under his watch.
The Australian lender said it is confident in its position against Shayne Elliott and will defend the matter “vigorously,” according to an ANZ statement on Friday. Current and former senior executives took hits to bonuses, with Elliott forfeiting A$13.5 million (US$9 million, or $11.62 million), for failures that resulted in regulatory penalties and extra capital requirements.
ANZ was fined A$240 million this year by Australia’s corporate regulator for misconduct in its retail and institutional divisions. The bank was also slapped before that with an additional A$250 million capital requirement after shortcomings in leadership and poor behaviour in its markets division were revealed.
“The Board has been considered and very deliberate in its assessment of remuneration outcomes,” ANZ chair Paul O’Sullivan said in the statement. It had decided that no Australian-based group executive would get short-term bonuses for this year, and that some of the long-term bonus due to vest to Elliott would be zero for 2025 and 2026.
The Australian Financial Review quoted Elliott as saying that he had a “clear, unambiguous agreement” about the terms of his departure, which he claimed were breached when ANZ’s board decided to cancel his bonus. He said this left him with no alternative other than to start legal proceedings, the newspaper reported. Elliott didn’t respond to a request for comment sent by Bloomberg News via his LinkedIn.
Proxy adviser Glass Lewis recommended that investors should vote against ANZ’s pay report at its upcoming annual shareholder meeting on Dec 18, due to “insufficient remuneration consequences”. The millions cut from compensation didn’t fully reflect failures to manage non-financial risks, it said.
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Since taking over the reins from Elliott in May, ANZ’s new CEO Nuno Matos has instituted a raft of changes to address problems. Matos is slashing some 3,500 jobs and hired a number of new senior executives as he seeks to turnaround the bank and improve performance.
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