Australia and New Zealand Banking Group Limited (ANZ) said a review of its securities lending practices had found risk controls were inadequate and that some employees breached the bank's code of conduct. The review was launched following the collapse of Opes Prime.
Chief executive officer Mike Smith said there have been no winners from what he described as an unfortunate series of events.
"The collapse of brokers has had a significant affect on the lives of their clients and their families together with those of the affected staff members at ANZ," he said.
Mr Smith, who headed up the review, said business practice, governance and management accountability related to the securities lending business within ANZ had been examined and a comprehensive remediation plan had been developed.
"The review committee found weaknesses in the management and oversight of the equity finance business within ANZ's securities lending unit," Mr Smith said.
"Taken together, this meant that ANZ did not adequately identify and manage the range of risks which arose from the operation of a business of this nature."
In reviewing the issue, Mr Smith said the findings had wider implications for ANZ's management of other non-traditional businesses, particularly in the institutional division.
"The review committee identified breaches of ANZ's Code of Conduct by two employees who will leave ANZ," he said.
This morning, the bank said Chris Page had been appointed chief risk officer, replacing David Stephen.
The group also said Alex Thursby had been appointed acting group managing director institutional division, in addition to his responsibilities as group managing director Asia Pacific, while an executive search was undertaken for the role.
"He replaces Peter Hodgson who is also leaving ANZ," Mr Smith said.
ANZ said the Review Committee's report had been presented to the ANZ board, which accepted the findings and gave its full support to the remediation program.
The group said the report provided to the ANZ board had been released today and had also been provided to the Australian Prudential Regulation Authority and the Australian Securities and Investments Commission.
At 1130 AEST, ANZ was up 13c to $15.72.