Sir Ralph Norris laughs off chairman rumours for Westpac's Australian parent

Westpac Banking Corporation in Australia has been embroiled in a scandal of alleged money laundering breaches. Photo/Richard Robinson.

Career Kiwi banker Sir Ralph Norris has laughed off suggestions that he is being considered as a potential chairman for embattled Australian bank Westpac.

Norris was speculated on as a contender to replace Lindsay Maxsted at the bank by the Australian Financial Review.

Westpac Banking Corporation, the parent of New Zealand's Westpac bank, has been caught up in a compliance scandal wherein Australian regulator Austrac alleges it breached anti-money laundering laws 23 million times.

Its chief executive Brian Hartzer resigned in the wake of the scandal last month and chairman Maxsted has said he will make an early exit.

That has left at least two major positions for the bank to fill. Norris, a former chief executive of Commonwealth Bank of Australia and its New Zealand subsidiary ASB, was viewed as a possible contender by one Aussie fund manager.

But when approached by the Herald this morning Norris laughed at the suggestion.

"That's the first I have heard of it," he said.

"I think you can tell from my reaction that I am not a candidate," he added.

Sir Ralph Norris. Photo/Greg Bowker.

Westpac chief financial officer Peter King took over as acting chief executive at the bank on Monday.

Hartzer left with a hefty golden handshake of 12 months' pay, amounting to A$2.7 million ($2.8m).

Austrac has alleged that Westpac engaged in widespread, systemic and frequent failures to adhere to laws combating money laundering and terrorism financing.

The agency, which uses financial intelligence and regulation to disrupt money laundering, terrorism financing and other serious crime - said it had applied to the Federal Court of Australia for civil penalty orders against the bank.

They relate to alleged systemic non-compliance with the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 in Australia.

The Reserve Bank of New Zealand has said it is working closely with its overseas regulatory counterparts following the allegations.

Westpac New Zealand has said the Austrac proceedings relate to Westpac Banking Corporation and Australian AML/CTF laws.

"We regularly engage with the Reserve Bank of New Zealand about AML/CFT obligations and will continue to do so," it said.