ANZ bought $7.5m Auckland property for David Hisco

The wife of former ANZ New Zealand boss David Hisco bought the couple’s Auckland family home from her husband’s employer for substantially less than its capital valuation in 2017.

Deborah Walsh paid $6.9 million in July of that year for the lavish St Heliers property, less than the $7.55m ANZ paid when it bought the house in early 2011.

The luxurious 700 square metre ocean-view home, reached by a private driveway that runs off the main St Heliers Bay road, includes a heated swimming pool, tennis court and six bedrooms.

Valuations service QV put the property’s 2017 capital value (including an estimated $7.2m land value for the 2454sqm parcel) at $10.75m.

The revelation is likely to raise more questions about Hisco’s employment package with ANZ as disclosed by chairman Sir John Key.

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House prices in the broader St Heliers area roughly doubled between 2011 and 2017 according to real estate agents Barfoot and Thompson.

Title transfer documents show ownership of 269 St Heliers Bay Road was transferred from Arawata Assets Limited, a wholly owned subsidiary of ANZ NZ, to Deborah Veronica Walsh on July 31, 2017.

On Friday evening ANZ’s spokesman said the bank bought the house when Hisco arrived in New Zealand.

“The housing allowance that David received as part of his expat arrangements — which was disclosed annually — was offset by the market rent David was required to pay ANZ for the house.”

The house was eventually sold by the bank to his wife based on market valuations done at the time, he said.

Hisco’s corporate expense account has been at the centre of a mounting controversy surrounding the New Zealand operations of the Australian-bank since it announced his abrupt departure on Monday.

Stuff understands that Hisco and Walsh made the residence their family home for years prior to Walsh’s purchase and oversaw its refurbishment in 2015 and 2016, when improvements paid for by ANZ included a new roof, security upgrades and refitted bathrooms.

Antonia Watson, the current interim head of ANZ New Zealand, was one of three directors of Arawata Assets at the time of the 2017 sale.

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Company filings show she was appointed director in February 2017, a role that ended in October of that year.

At the time, Watson was managing director of ANZ NZ’s business and retail banking; she was tapped by Key to step into David Hisco’s shoes on Monday and invited to throw her hat in the ring for the permanent position.

Arawata’s other directors in 2017 were Annis Gail O’Brien, who remains a senior executive with ANZ Group and is responsible for the company’s statutory and regulatory reporting requirements in New Zealand. The third director at the time was Felicity Evans, then the general manager of human resources at ANZ NZ, now retired.

Questions about Hisco’s extraordinary expense account at ANZ have mounted since Key revealed Hisco misrepresented tens of thousands of dollars’ worth of personal bills as business expenses, including wine cellaring and chauffeur-driven cars.

Hisco has enjoyed “non monetary” perks of some A$3.35m (NZ$3.52m) across his eight full financial years in the ANZ NZ top job. The expenses were in addition to an annual multimillion dollar cash salary and stock grants and options.

​Hisco became chief executive in late 2010. In 2011 when his non monetary benefit was A$357,283, the company’s annual report cites expenses such as flights, housing assistance and taxation services. In subsequent years, however, the citation becomes more vague, mentioning only expenses relating to the New Zealand relocation.

Even after Hisco and his wife, Deborah Walsh, bought a ground floor apartment in the Auckland suburb of Kohimarama in 2014 for NZ$1.7m, relocation was cited for his company expenses (they owned the apartment until 2016).

Hisco and associates also purchased an Omaha beach house from Key. The house has an estimated value of $3.83m.

Key said the way Hisco reported personal benefits as business expenses fell short of the standard required by the bank.

Key said the practices were uncovered through an internal review of executive spending conducted earlier this year.

He cited ANZ’s “culture of strong values” in holding Hisco to account, and said that “when people do not do the right thing we hold them to account no matter their status or position in the organisation.”

Politicians, including Prime Minister Jacinda Ardern, are under mounting pressure to call a larger inquiry into banking practices in New Zealand. Earlier in the week she described the issue of Hisco’s expenses as a private employment matter.

Separately, ANZ NZ has suffered significant censure from the Reserve Bank of New Zealand for failing to calculate its capital requirements properly.

Prior to his departure, Hisco was on medical leave. A neighbour to his St Heliers home said Hisco and Walsh have been away from home for several weeks. Blinds were down at the residence and a call through the intercom went unanswered, though the lawn and garden were beautifully maintained.

Hisco’s expenses consistently outstripped those of his executive colleagues at the Melbourne-based parent company ANZ Group.

In the 2018 financial year, Hisco’s “non monetary benefits” totalled A$464,599 according to the company’s annual report. After Hisco, the highest non monetary benefits for an ANZ executive in that year was for A$52,472 for retiring chief risk officer Nigel Williams.