National Australia Bank has picked veteran investment banker Craig Drummond as its next chief of finance and strategy, in a surprise move that puts him in the mix as a potential successor to Cameron Clyne.
The appointment might also signal that NAB - seen as the laggard among the big four - is seeking to expand its presence in wealth management and institutional banking.
After 27 years in financial services, most recently at the helm of the Australian arm of Bank of America Merrill Lynch, Mr Drummond will take on the new role later this year. He will replace retiring CFO Mark Joiner.
Given his experience, Mr Drummond is seen as a potential successor to Mr Clyne, who has been chief executive of the bank for four years.
BuinessDay this week revealed that Mr Clyne remained in the bottom quartile among rankings of chief executives in the April edition of the highly influential Corporate Confidence Index. The confidential survey benchmarks the perceptions of top analysts and fund managers against a list of major companies.
Mr Clyne hailed Mr Drummond's record and leadership skills, saying he would make a "strong addition" to NAB's management ranks.
But analysts also highlighted the differences between the fast-paced world of investment banking and the more stodgy environment of retail and business banking.
"It's a big step from running an investment bank, particularly in terms of culture, to being a senior executive in a retail/small-medium enterprise bank," Macquarie analyst Mike Wiblin said.
BBY's Brett Le Mesurier said it was also "reasonably rare" for a CFO to become chief executive of a major Australian bank.
"I cannot remember the last time the CFO of a major bank became chief executive," he said.
But he also noted Mr Drummond had a long-standing relationship with the bank.
In recent years NAB has frequently been advised by Merrill Lynch and Goldman Sachs JBWere, where Mr Drummond was a long-serving executive.
Mr Clyne has not said how long he expects to remain in the top job.
Mr Drummond will receive the same pay as Mr Joiner, who made $3.7 million in 2012. NAB will also pay Mr Drummond $6.5 million in cash and shares to compensate him for incentives he will forfeit in joining the bank.
Before moving into management in the 1990s, Mr Drummond was one of the top-rated banking analysts at Goldman Sachs.
A former competitor, CLSA's Brian Johnson, talked down the importance of Mr Drummond's investment banking background and said he was well connected among global investors and well versed in creating shareholder value.
Mr Johnson said he did not think Mr Clyne would resign soon, and Mr Drummond would make a strong CFO. "I think he's a great hire. A lot of these things actually come down to the person and I rate Craig very highly," Mr Johnson said.
The appointment comes as NAB has been bulking up its presence in wealth management - an industry tipped to benefit from rapid expansion in the $1.5 trillion superannuation pool.
NAB snapped up the wealth management arm of Goldman Sachs JBWere in 2009, the Australian arm of Aviva in 2011, and made an aborted bid for AXA Asia-Pacific in 2010.