Deputy Prime Minister Winston Peters is gunning for the wrong scalp when it comes to claims of a conflict of interest between the bank's New Zealand board and the parent board based in Melbourne.
On Monday's Q&A programme on TVNZ, Peters called on Sir John Key, who chairs ANZ Bank (NZ) to resign and said, "it's wrong that Mr Key can be head of the ANZ in New Zealand and sit on the Australian equivalent as well".
It should be pointed out that Key is not the only chair of one of the "Big Four" Australian banks domiciled here to currently also sit on the main board in Australia. At BNZ, chairman Doug McKay is also a NAB director.
There is arguably a strong case for having the chair of the New Zealand operations holding a dual directorship at the Australian parent. Particularly when the New Zealand operation makes up 25 per cent of their business — as is the case with ANZ. A former ANZ chairman, Sir Roderick Deane, also sat on ANZ Banking Group's board.
But it is time for a major shake-up of the ANZ New Zealand board and the bank's Australian boss Shayne Elliott being the first to go.
Elliott's position is different. He is the only chief executive from Australia's Big Four banks to sit on the board of their New Zealand banking operations. The other three banks have a single representative each from their Australian parent. But not the Australian CEO. In ANZ's case Elliott and his chief financial officer Michelle Jablko are on the NZ board.
In my view, Elliott over-reached when he went public on the Reserve Bank's proposals to increase banks' regulatory capital requirements, saying not only that they would "come at a cost" but that ANZ could not expect its shareholders to unreasonably "subsidise" this.
There is much to debate about the Reserve Bank's proposals. But Elliott's central proposition that his shareholders should not be the ones to take any hit — but instead ANZ's New Zealand customers — verges on crass.
As he said at the time, ANZ wants to continue to support the economy, "but we cannot expect our shareholders to unreasonably subsidise those ambitions.
"Clearly we have options, on the amount of capital we put into New Zealand, and on how we [deploy that capital], into which sectors and what returns we require of it," he said at a presentation of ANZ's half-year results in Sydney on May 1.
"We have shown we are not shy of taking hard decisions. We will act — and we have a responsibility to act responsibly with our shareholders' capital and we will do so."
Elliott might be a New Zealander but he has a tin ear when it comes to the current New Zealand environment. The same day he was sabre rattling, the bank's New Zealand division reported an 18 per cent jump in first-half cash net profit after tax to NZ$1.1 billion — which while boosted by a number of one-off transactions — clearly was a major contributor to the A$3.173b the ANZ Banking Group reported.
The counter-factual to Elliott's positioning is that the Australian banks have profiteered immensely over the years from their well-run New Zealand operations. That the interests of its Australian bank shareholders should be balanced with those of other stakeholders which obviously include New Zealand customers.
It does not take a genius to mount the argument that ANZ's New Zealand customers have at time subsidised the Australian operations via the profit shifting to Australia.
It is a view that is shared by senior ministers in the Ardern Government.
If Key is to be other than a trophy director he needs to advocate at parent level. In an interview with me last week on the Reserve Bank proposals he said it was a legitimate debate to have.
Key plans to widen the ANZ board. Tony Carter will stand down next year and Key is currently talking with two potential directors — understood to be women. With the challenges in front of banking the board arguably needs to be upweighted with directors who have digital experience. Particularly given the threat from fintechs and open banking.
What was interesting with Peters' appearance was his deliberate reference to Sir John as "Mr Key".
Notably, Finance Minister Grant Robertson had also castigated "Mr Key" when Sir John appeared to blame a junior staffer for ANZ's use of an outdated capital risk model; an issue which is now the subject of a Section 95 requirement by the Reserve Bank for a report covering ANZ New Zealand's compliance with the Reserve Bank's current and historic capital adequacy requirements.
The Reserve Bank has also requested a further report to assess "the effectiveness of ANZ New Zealand's Director's Attestation and Assurance framework, focusing on internal governance, risk management and internal controls".
In an interview with this columnist last week, Key said the ANZ New Zealand directors had "failed" in their obligations to the bank when it came to their attestations on risk capital.
That process will play out.
David Hisco, like other chief executives of the Australian banks domiciled in New Zealand, was also a member of the New Zealand board. His directorship ceased on June 17 — the date of his resignation from ANZ and also the date of the extraordinary press conference.
The ANZ New Zealand board has some soul searching to do.
There has been a frustrating lack of precision over what actually led to Hisco's departure. This is disappointing.
In Australia, Hisco's scalping is seen as a direct play by Elliott.
Senior business journalists that I rate like the Australian's John Durie could confidently write the "tens of thousands of dollars" that Key said has been "mischaracterised" as a A$25,000 figure.
A New Zealand board on top of its stuff would put the correct figure out.