Targett Speaks about ANZ Failures

Submitted by Jim Thesiger on 17 August, 2009 - 09:53

After leaving ANZ Banking Group (ANZ) in June 2007, for the first time Steve Targett, the former institutional banking chief has spoken claiming that the bank could have saved around $200 million worth of settlement costs and innumerable damage that struck its reputation only if it went for an internal recommendation during 2007 that insisted that instead of ramping Opes Prime Business, the bank should exit from it. According to Mr. Targett, informal talks regarding selling the business took place. However, he didn't make any remarks regarding the speculation about he advised the board to exit the business in 2007. Mr. Targett said that he was concerned about the custody business of the bank, which included the securities lending division that lent money to troubled stock lending firms Tricom, Opes Prime and Chimaera. It is to be mentioned that the former institutional banking chief is currently in a stand-off with the bank over a multi million dollar legal battle.

Mr. Targett's comments came within three weeks following the declaration of Opes creditors where they have agreed to accept a settlement worth of $253 million from ANZ Bank and Merrill Lynch and ASIC's decision not to pursue any action against these banks. Securities lending division of ANZ bank gained considerable amount of attention after the stunning collapse of Melbourne stock lending firms Opes Prime and Chimaera, and the crisis regarding the Sydney firm Tricom. Crawford inquiry saw the exit of Mr. Peter Hodgson (who was Mr. Targett’s successor) and 7 other stuffs and the decision made by the bank to exit from security lending.

In his statement, Mr. Targett blamed lack of efficiency and poor strategies of the credit and trading risk committee for a lot of problems that the bank had to deal with. A large number of failures and deficiencies in relation to the bank's equity finance business were identified by the Crawford report.