Supercity bank draws critics

John Waller. Photo / Supplied

A senior banker has spoken out against what he sees as a lack of transparency in how the new Auckland council's banking partner was chosen - saying it wasn't "as kosher as it could have been".

The Auckland Transition Agency (ATA) - the body set up to merge the region's seven councils into one - announced in June that the BNZ would be the banking partner for the new Auckland council.

The contract, believed to be worth several million dollars, will see BNZ manage the council's $3 billion annual budget and $29b in assets.

BNZ chairman John Waller, who is also a board member of the ATA, asked to have nothing to do with any selection to avoid any conflict of interest.

But the banking insider - who declined to be named - said the process "was characterised by a lack of transparency, some hidden agendas and a lot of jockeying for positions".

He said: "Several of the people involved seemed to have quite strong allegiances to one bank or another.

"There was a lot of politics between the councils. There were people acting on historical motivations rather than what was best for Auckland City.

"All that added up to a process that was far from best practice."

He said an uncertainty over jobs in the new Auckland council made the process run a lot less smoothly than it could have.

ATA spokesman Clive Nelson said that four of the main banks placed tenders that were evaluated by Audit NZ.

He said: "John Waller, the chairman of BNZ, asked the board that his interest in BNZ be noted. He played no part in any discussion, evaluation or selection of banking organisations." Waller said any involvement in the tendering process would be "untenable".

He said: "That would be totally inappropriate for me to be involved."

It comes after Michelle Boag voluntarily removed herself from her firm Momentum's recruitment of Supercity executives after it emerged she was also acting as a voluntary adviser to mayoral contender John Banks.

Labour's Auckland issues spokesman Phil Twyford said "mega-contracts" created by the council merger would create problems with conflicts of interest in the future. "The way the Government has set up the Auckland Supercity has really created some very fertile ground for cronyism."

A BNZ spokesperson said the application was probably the most rigorous process the bank had been through for a tender of this nature.