Shares in stricken wealth manager IOOF Holdings lost another 7% yesterday after its CEO and chairman stepped down to fight moves by APRA, the prudential regulator to disqualify them from managing superannuation funds.
CEO Christopher Kelaher and chair George Venardos have taken leave with immediate effect to focus, IOOF told the ASX in a statement yesterday morning.
The duo have been replaced on an interim basis by wealth management boss Renato Mota and non-executive director Allan Griffiths.
IOOF shares ended down 7% at $4.28 after losing 35% on Friday in the wake of APRA’s shock announcement.
The other IOOF executives APRA is seeking to have disqualified from being pension fund trustees – chief financial officer David Coulter, company secretary Paul Vine and general counsel Gary Riordan – will stay on at the company but will have no responsibilities in relation to the management of the IOOF trustee companies and will have no engagement with APRA.
APRA has claimed that IOOF used money belonging to pension fund customers to compensate them for losses caused by the company.
It last week said it had had concerns about conflicts of interest at IOOF since 2015, adding the firm had failed to address the issues for years.
IOOF, whose shares lost more than a third of their value on Friday following APRA’s announcement, again strongly denied the accusations in yesterday’s statement.
“We maintain our position that the allegations made by APRA are misconceived, and will be vigorously defended,” Mr. Griffiths said in that statement.
He said IOOF acknowledged the seriousness of the allegations and that he and Mr. Mota would co-operate with APRA on what he called “previously agreed initiatives”, many of which he said were complete.
“We have a responsibility to our superannuation members, shareholders, advisors, employees and the wider community, to take decisive action,” he said.
“We are entirely focused on addressing the governance issues in the interests of all stakeholders and will do so in an orderly manner.”
APRA is also seeking to impose additional conditions on the firm’s superannuation business.
The move could threaten to end the planned $975 million purchase of ANZ’s OnePath wealth business
In October 2017 IOOF said it would agree to buy ANZ’s Australian OnePath Life business and some financial planning operations.
But that deal is now in doubt as ANZ said Friday it was seeking clarification over APRA’s intervention.
ANZ shareholders meet in the 2017-18 AGM a week tomorrow. Expect that to be a bruising affair for the bank, just as Westpac’s will be at its AGM tomorrow.
