In these regards, we have observed a trend for overseas-owned banks in New Zealand increasingly to adopt “matrix management” arrangements, under which the reporting and accountability lines of local managements to their local boards may be weakened by direct reporting lines to overseas head-office managements.
Hence, we took the opportunity when approving the amalgamation of the ANZ and National banks, to reinforce that the board of the merged bank must carry prime responsibility for oversight of the bank in New Zealand. Consistent with this, we have required that the chief executive of the bank must be appointed by, and be primarily accountable to, the New Zealand board.