The Financial Times, citing a statement from Thorburn, said the CEO acknowledged that the bank “has sustained damage as a result of its past practices and comments in the royal commission’s final report about them. I recognize there is a desire for change.” Thorburn is expected to give up his roles later in February. Meanwhile, chairman Henry will retire from the board when a new permanent CEO is named. Current National Australia Bank director Philip Chronican will take on the role of acting CEO starting on March 1.
The announcement of the resignation of Thorburn and the retirement of Henry come after the release of the findings of a royal commission inquiry that spanned a year. According to the inquiry, NAB hit customers with close to A$100M in fees but failed to provide any services. The report, according to The Financial Times, also laid out how Sydney branch staffers took bribes to push through loans based on falsified documents. The goal of the branch workers was to reach internal sales targets, noted the report. The report noted that the performance of the two executives when speaking during public hearings in 2018 really doomed them. In the report, Kenneth Hayne, who chairs the royal commission, questioned whether the executives have really learned anything and if they could really reform the culture at the bank.“Overall, my fear — that there may be a wide gap between the public face NAB seeks to show and what it does in practice — remains,” he said, according to The Financial Times.
Henry told the paper Thursday (February 7) that his decision to retire was not due to the report but because he has been looking more broadly at what the bank needs to turnaround its prospects.
While Thorburn has received praise in the past, since December he has been dealing with pushback from investors who aren’t happy with how the bank is being run. An overwhelming majority of shareholders voted against the bank’s compensation proposal in December, noted the report. At the time Chairman Henry told shareholders he “misjudged” the overhaul of pay for executives.