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Speaker 1: From The Australian. Here's what's on the front I'm Claire Harvey.

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Speaker 1: It's Thursday, September eleventh, twenty twenty five. Opposition leader Susan

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Speaker 1: Lee has sacked firebrand Senator Jacinta numbm for Price from

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Speaker 1: the front bench after Price refused to apologize for remarks

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Speaker 1: about the Indian community. Price says she has legitimate concerns

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Speaker 1: about the scale of Labour's migration intake. Lee says Price

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Speaker 1: fails the test for a position of responsibility and can't

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Speaker 1: continue if she won't back her leader. HERMAS leaders will

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Speaker 1: never be safe. That's Israel's message after it made an

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Speaker 1: airstrike against Hamas leadership in Qatar, triggering a brawl with

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Speaker 1: the White House. Donald Trump slapped down Benjaminette Nia who

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Speaker 1: over the strike, which came as Qatar was hosting ceasefine

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Speaker 1: negotiations aimed at getting Israeli hostages home. He says he

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Speaker 1: will not allow immunity for terrorists anywhere in the world.

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Speaker 1: Those stories alive right now at the Australian dot com

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Speaker 1: dot a U. If you work in banking, watch out.

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Speaker 1: Thousands of jobs are being cut as bosses prepare for

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Speaker 1: a leaner future and shred projects that aren't working today.

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Speaker 1: The man swinging the axe at Australian banking's biggest employer,

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Speaker 1: an Z, they call him Nunageddon.

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Speaker 2: Oh Vily, this is a very very special moment to me.

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Speaker 2: It really means a lot.

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Speaker 1: Nunomatos is an adventurous fifty seven year old ocean swimmer

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Speaker 1: who's just moved his family to Australia and when he

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Speaker 1: was announced as the incoming chief executive of A and

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Speaker 1: Z Bank in twenty twenty four, you could feel the

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Speaker 1: energy radiating through his warm Juguese accent.

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Speaker 2: My grandfather was an Indian and he actually in his thirties,

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Speaker 2: he moved to Africa where he met my grandmother. She

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Speaker 2: came from Portugal. I met my wife in Perusius, Pruvian

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Speaker 2: and we have two boys. One was born in Spain,

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Speaker 2: the other was born in Brazil. And actually at home

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Speaker 2: we always speak three languages every single day, and well

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Speaker 2: I can't forget our two dogs, one from the US

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Speaker 2: and the other from Mexico. We are kind of united

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Speaker 2: nations at home.

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Speaker 1: He made his career from his start straight out of

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Speaker 1: UNI at Portugal Central Bank to a globe trotting banking

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Speaker 1: career sound like one long, fabulous dinner party.

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Speaker 2: After living in nine markets from Asia to the Americas,

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Speaker 2: Australia feels a perfect country to live, to be happy

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Speaker 2: and to develop new friends and new professional connections.

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Speaker 1: By the time his face were under the desk vacated

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Speaker 1: by former boss Shane Elliot, Martos was sounding a little

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Speaker 1: more weary.

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Speaker 2: We have to run faster and at the same time

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Speaker 2: with more excellence operating at this full potential.

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Speaker 1: Here's what that meant.

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Speaker 2: The A and Z will cut three thousand, five hundred

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Speaker 2: of its forty three thousand staff plus another thousand contractors.

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Speaker 2: The unions have gone ballistic, staggering, a catastrophic announcement for

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Speaker 2: so many staff who work here within the ANZ banking organization.

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Speaker 1: And suddenly he has a new nickname, Nunigeddin. Eric Johnston

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Speaker 1: is an associate editor with The Australian.

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Speaker 3: The mood has changed to azt ain Z was known

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Speaker 3: as a really warm and friendly and fuzzy bank. For example,

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Speaker 3: they even had meditation training courses many years ago under

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Speaker 3: a former chief executive, John McFarland. They had a more

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Speaker 3: international perspective, but they were a very warm, friendly institution

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Speaker 3: and that sort of allowed a lot of flexibility for

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Speaker 3: their workforce. And what we've seen is a sudden shift,

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Speaker 3: and now that shift means people are coming back to

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Speaker 3: the office. Last week I sat down and went down

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Speaker 3: to the Docklands headquarters and just worked out of there

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Speaker 3: for a few mornings. No one asked a question, no

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Speaker 3: one knew who I was.

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Speaker 1: Had anyone invited you to come with your laptop.

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Speaker 3: No, no, But they do great coffee, fantastic coffee, and

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Speaker 3: you just sort of park the corner there and look,

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Speaker 3: people were there, people were working, People were really well dressed.

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Speaker 3: And that's one of the things when the new chief

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Speaker 3: executive came in, he had complained that Australians didn't look

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Speaker 3: like bankers because people were really casual, ave dressing down

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Speaker 3: and so on. So suddenly I'm noticing a lot more ties,

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Speaker 3: a lot more suits are on. People were back, People

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Speaker 3: were in the office and they knew. There was an

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Speaker 3: anticipation in the air that something big was going to happen,

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Speaker 3: and it did.

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Speaker 1: Now on paper, this bank is doing quite well. It

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Speaker 1: made six billion dollars cash profit. Reported that this year.

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Speaker 1: Nuno Martos is on a two and a half million

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Speaker 1: dollar salary. With a two and a half million dollar bonus,

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Speaker 1: which I guess he might be achieving if he cuts

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Speaker 1: these costs. What's going wrong at ain.

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Speaker 3: Z, Well, just on the salary, so that that will

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Speaker 3: escalate to up to ten million dollars at its maximum

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Speaker 3: potential if all the long term benchmarks are achieved. That's

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Speaker 3: the way it's structured. But it is a big number,

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Speaker 3: six billion dollars. Wow, look at that pure profit. Certainly

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Speaker 3: big number becomes less impressive when we start thinking, Okay

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Speaker 3: and z's asset base is about six hundred billion dollars.

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Speaker 3: It's kind of reasonable, but banks generally can do a

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Speaker 3: bit better. So Comewealth Bank is a really well run

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Speaker 3: bank and it generally returns about thirteen and a half

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Speaker 3: to fourteen percent. So you can see you can see

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Speaker 3: the gap there. Nuno Martos. He's coming from HSBC, a

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Speaker 3: big global bank, and he's seen the immediate problem. A

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Speaker 3: and Z's got a list its shareholder returns, and this

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Speaker 3: is one way that he wants to go about doing it.

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Speaker 1: There's a lot of talk about big changes to something

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Speaker 1: called A and Z plus What is that and what

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Speaker 1: would that mean?

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Speaker 3: So what it is for the last six years under

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Speaker 3: the former management, a Z has been building what it

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Speaker 3: calls at the front end, a new app called ain

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Speaker 3: Z Plus. It's been promised for ages and talking five

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Speaker 3: or six years in the planning. So far they've spent

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Speaker 3: one point five billion dollars on building. Effectively an app

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Speaker 3: that they've been promising is going to be rolled out.

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Speaker 3: It's starting to be rolled out to some customers. They're

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Speaker 3: promising in the world your hoold ten minute mortgages. It

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Speaker 3: will do your dishes, it'll do everything, but it's yet

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Speaker 3: to be delivered. The upside for ain Z though, it

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Speaker 3: allows processes to be done much more quickly and efficiently,

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Speaker 3: and I'll betting on with less people as well. That's

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Speaker 3: yet to eventuate. Nuno Martos has come in and looked

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Speaker 3: at this and he's thought of straightaway, why has this

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Speaker 3: app not been delivered? Why are we still building this thing.

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Speaker 3: There's a lot of mission creep in this app. So

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Speaker 3: he wants to take control of that. He just wants

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Speaker 3: to pair it back and just get it in people's

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Speaker 3: hands and get it delivered. And so by this time

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Speaker 3: next year, the expectation is it will start to be

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Speaker 3: the main app. The aims and customers use.

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Speaker 1: We know the banks watch each other very closely. They

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Speaker 1: all put rates up within hours of one another, all

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Speaker 1: down depending on which way things are going. We've already

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Speaker 1: seen nab An ounce some job cuts. Would you expect

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Speaker 1: people in banking to be now nervous that all the

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Speaker 1: banks are going to look at whether they can bring

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Speaker 1: their whipfulces down.

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Speaker 3: I think what this does it gives others cover to

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Speaker 3: also do that. Look, Westpac has in recent years cut

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Speaker 3: about seventeen hundred rolls, but he didn't come out with

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Speaker 3: a big announcement. It just said, look, we want to

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Speaker 3: target a lower cost base. Come off bank again. You'll

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Speaker 3: hear every now and then. They might cut jobs, but

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Speaker 3: not in a whole cell way. And there's certainly under

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Speaker 3: no pressure to slash and burn because again they run

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Speaker 3: quite well. But it does give some of the others

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Speaker 3: a little bit of cover. It also gives Corporate Australia

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Speaker 3: cover to think, you know, if I come out tomorrow

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Speaker 3: and cut a thousand jobs, I'm not going to look

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Speaker 3: like the bad guy. That guy down the road at

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Speaker 3: AMS he's still looking pretty terrible. So that's what the

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Speaker 3: message is. But really, interestingly, what's happened is that since

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Speaker 3: the COVID pandemic, there hasn't really been wholesale job cuts.

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Speaker 3: So this was a real big wake up call. And

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Speaker 3: all large corporates have actually been hoarding labor because they're

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Speaker 3: so scared of a tight labor market, and when the

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Speaker 3: economy does go into an upswing, they'll have nobody to

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Speaker 3: be able to fund that growth or deliver into that growth.

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Speaker 3: So that's what we've heard of this term called jobs hoarding.

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Speaker 3: So this is a real change that mindset.

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Speaker 1: Coming up the long road down Under for Nuno Martos

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Speaker 1: and what other banking workers should expect. At the top

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Speaker 1: of this episode, we heard what Nuno Martos sounded like

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Speaker 1: when he got this job. He'd gone for a couple

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Speaker 1: of other big jobs. Reportedly he wanted the top job

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Speaker 1: at HSBC, didn't get that his name was murdered to

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Speaker 1: be the boss of Westpac. That didn't happen, got this

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Speaker 1: job at A and Z and then in his introduction

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Speaker 1: interview he spoke very warmly about moving to Australia with

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Speaker 1: his dogs and his kids. I feel like if he

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Speaker 1: knew he was going to be coming in here and

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Speaker 1: sacking a lot of people, he would have been less

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Speaker 1: effusive about the big opportunity for himself and his family.

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Speaker 1: He might have been a little bit more sensitive about that.

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Speaker 1: So therefore has he looked under the hood and found

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Speaker 1: some things that have shocked him.

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Speaker 3: Look, I think he knew exactly what he was going

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Speaker 3: to do when he signed up. And an interesting background

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Speaker 3: Portuguese banker worked at a Spanish for many years called Santander,

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Speaker 3: then moved across to HSBC, another big global bank, and

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Speaker 3: he was an executive on the rise at HSBC, and

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Speaker 3: they put him in what was probably their biggest problem

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Speaker 3: child business, which was Mexico. So he ran Mexico for

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Speaker 3: HSBC for many years, and that was after it had

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Speaker 3: a number of regulatory skirmishes, particularly around money laundering, and

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Speaker 3: you can imagine the complexity of that. Now. He really

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Speaker 3: got onto the radar of HSBC management there because first

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Speaker 3: of all, cutting costs, winning back the trust of regulators,

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Speaker 3: and while growing the business with customers and look, that

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Speaker 3: just ticked all the boxes for HSBC. He was in

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Speaker 3: the running to get the top job and just narrowly

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Speaker 3: missed out. At the time, Bloomberg described him as something

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Speaker 3: along the lines as the most eligible CEO in the world.

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Speaker 3: So was someone who was just had to It was

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Speaker 3: just a matter of someone reaching out coming to Rains.

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Speaker 3: He knew what needed to be done, reputation for cutting

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Speaker 3: costs and this is his playbook exactly.

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Speaker 1: So what's next.

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Speaker 3: What we don't know is where the jobs are going

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Speaker 3: to be cut exactly. We do suspect there's going to

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Speaker 3: be in the retail bank and we do suspect a

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Speaker 3: bit of our business banking. He's going to run up

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Speaker 3: to investors in the middle of next month, October, and

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Speaker 3: this is where he'll present his strategy. This is how

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Speaker 3: we're going to go forward. He's expected to put a

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Speaker 3: line in the ground saying we want to achieve these

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Speaker 3: kind of shareholder returns and we want to achieve this.

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Speaker 3: And in banking world it's called a cost to income

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Speaker 3: ratio and it is what it sounds like. It's about

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Speaker 3: your costs relative to the revenue you do. So we

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Speaker 3: expect him to put out a number to try and

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Speaker 3: target a lower cost to income ratio. Australian banks have

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Speaker 3: a terrible track record of cutting costs. They have a

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Speaker 3: terrible track record of really in these big change programs.

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Speaker 3: Sure change happens, but then they're very short term, like

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Speaker 3: banks get into their old ways. Regulation is a really

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Speaker 3: big deal in the Australian bank market. That's where a

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Speaker 3: lot of the baked in costs are from as well,

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Speaker 3: So he's going to confront some of these challenges as well,

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Speaker 3: so running the bank and running it well. At the

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Speaker 3: same time his rival banks CBA, National Australia Bank in Westpac,

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Speaker 3: they are just going gangbusters on business banking, so they're

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Speaker 3: throwing everything at that while he's taking things out of it.

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Speaker 3: So that's going to be an interesting battle to watch.

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Speaker 1: Eric Johnston is an associate editor with be Australian. You

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Speaker 1: can read his reporting from the lobby of Vanz's Dockland's

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Speaker 1: headquarters and all the best business news right now at

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Speaker 1: the Australian dot Com dot a