A former top bank director has reportedly called for former Prime Minister Sir John Key to resign "or be removed" as chairman of ANZ following an incident that saw it censured by the Reserve Bank.

In a letter to Reserve Bank governor Adrian Orr, Kerry McDonald, the chairman of BNZ for 12 years until 2008, said he was "amazed" at the limited penalty imposed on the bank, Stuff reported.

McDonald also took aim at several others at ANZ – including chief executive David Hisco – saying they should resign.

The Reserve Bank revoked ANZ Bank New Zealand's accreditation to model its own operational risk capital requirement due to a "persistent failure" in its controls and attestation process.

Advertisement

The decision means ANZ is now required to use the standardised approach for calculating appropriate operational risk capital. From March 2019, this will increase its minimum capital held for operational risk by around 60 per cent, to $760 million.

According to the Reserve Bank, ANZ's failure to use an approved model was revealed after encouraging ANZ to review its attestation and assess its compliance with capital regulations.

A spokesperson for ANZ said: "ANZ New Zealand does not believe there is a systemic failure in its controls and attestation processes.

"While isolated, and with no impact on customers or the operation of the bank, ANZ New Zealand is disappointed this error occurred.

"Mr McDonald is welcome to discuss the issue with us at any time."

Sir John Key was named chairman of ANZ Bank's local arm in October 2017 and began his role in early 2018.

- With BusinessDesk