SYDNEY/HONG KONG (Reuters) – Australia’s Westpac Banking Corp (WBC.AX) named a former Barclays (BARC.L) boss as chairman on Thursday, entrusting veteran banker John McFarlane with the task of steering it through the country’s biggest money-laundering scandal.
The bank, Australia’s second largest by market capitalization, said the 72-year-old would become a non executive director in February before taking the chairman’s role in April.
McFarlane stepped down as chairman of Barclays in May after four years. Previously he had chaired British insurer Aviva (AV.L) which followed nine years as chief executive (CEO) of Westpac rival Australia and New Zealand Banking Group (ANZ.AX) (ANZ).
Scottish-born McFarlane takes over just two months after Westpac’s top two executives stepped down following charges by the regulator for breaching of anti-money laundering laws which potentially facilitated child exploitation.
Westpac’s current troubles are part of wider ructions in the Australian banking industry. Two of the top four banks that dominate the domestic market have lost their leaders in the wake of damaging revelations from a government-backed inquiry into misconduct in the industry.
McFarlane’s appointment, however, failed to boost the bank’s shares on Thursday as investors said the prospect of a huge fine – estimated by analysts to be up to A$1 billion – for the anti-money laundering breaches continued to weigh on the bank’s earnings prospects.