The interview: ANZ's new CEO Antonia Watson

You won't find ANZ chief executive Antonia Watson travelling around town in a chauffeur-driven car.

Instead the new boss of New Zealand's largest bank is a keen fan of e-scooters and e-bikes.

"It's my third scooter ride of the day," she revealed after arriving at the Herald's offices kitted out in a high-vis vest and helmet this week.

"It's the only way to get around town in high heels."

It's a practical no-nonsense approach to traversing central Auckland, which has become a minefield to travel across by car as roadworks have continued to envelope the city.

But it's also a clever reminder that Watson is very different to her predecessor David Hisco, who left the bank in June last year amid an expenses scandal involving "mischaracterisation" of expenses relating to chauffeur-driven cars and wine storage.

Watson, stepped into the frying pan of the top job as acting chief executive with a media stand-up alongside former prime minister Sir John Key - ANZ New Zealand's chairman - announcing Hisco's departure.

The bank was already facing pressure after receiving a ticking off from the Reserve Bank over the way it calculated its capital reserves.

Then the media storm began with Hisco's departure and the subsequent revelation the bank sold a luxury Mission Bay house to Hisco's wife for what appeared to be a lower than market value.

"It was completely unexpected," Watson says of being thrust into the firestorm.

"David was always going on long-service leave so I had always had a plan of 11 weeks acting. I knew that but then the circumstances and the constant media and staff really unsettled - every day there was another story - it certainly wasn't what I was expecting.

"It was a massive lesson in resilience."

But Watson says she became used to it.

"It went from heart turning over every day when you opened the paper to see what was next to "oh let's see what's next today".

Sir John Key, chairman of ANZ Bank and ANZ chief executive Antonia Watson announce the departure of former chief executive David Hisco. Photo/File.

It was also a quick lesson on the scrutiny that came with being the boss of a bank.

"The circumstances were unfortunate but it was a good immediate lesson in what the role would bring. To decide whether you want to do it."

Far from putting her off Watson says decided she wanted to rise to the challenge.

Some questioned how she could get the job given her involvement with the Hisco house sale. She sat on the board of Arawata Assets the ANZ owned company which approved the sale.

A Financial Markets Authority investigation found the sale should have been disclosed in the bank's financial accounts, although the bank disagreed with that view.

But an independent report by Deloitte noted no ANZ policies had been breached and that it was the former chairman's decision.

Watson says she always felt comfortable with her part in it.

"I always felt very comfortable in my role. Appropriately Arawata assets owned the property as it owns and leases all our properties.

"I happened to be on the board and the reason I was on the board was because it owns and leases branches and there are health and safety implications so it was important I was involved in that.

"Then a particular transaction comes along. The chairman made a recommendation to us - it was based on two independent valuations. We took the right tax, accounting advice. As a board we were very comfortable that the transaction happened. We were comfortable for the transaction to happen because it really was non-core for us to own a luxury property."

What about the fact the property was bought by the chief executive's wife?

"People do it for privacy reasons or use family trusts - it didn't even occur to me. She owned their house in Melbourne - and people make choices about who owns the property in their families."

Watson says she has had intermittent contact with Hisco since his departure.

"I've spoken to him a few times. He worked with us for a long time and he is interested in how everyone is going. We were interested in his health which has improved, which is great. The rest of the conversation is private."

Unlike Hisco Watson isn't an ANZ lifer. He worked his way up from branch level to the top and had spent his whole career with the bank.

David Hisco, former ANZ chief executive left in June amid an expenses scandal. Photo/Sarah Ivey

Watson, the first New Zealand-born woman to head ANZ NZ, grew up in Auckland's Epsom where her mother was a lawyer and father a pharmacist.

Her mother quit law to have a family and then joined her father in the pharmacy to build the business once Watson's younger sister started school.

Watson trained as an accountant at Otago University before moving back to Auckland to work for KPMG.

Then like many Kiwis she departed on her OE backpacking across Europe and landing in London looking for a job. She was hired by investment bank Morgan Stanley and spent 13 years working for them in London, Sydney and in Hungary.

Watson and husband Tim had always planned to come back to New Zealand but decided to work in Hungary to try something different before settling back home.

"We sort of said shall we go home now or shall we do one more thing? We don't have children so are very flexible. I had been looking at India and Hong Kong, and Budapest just sounded awesome."

But it was also a bit of a culture shock.

"We never expected to live in a place where English wasn't the first language or we needed a work visa."

While they enjoyed the easy access to travel in Europe they found there wasn't as much diversity of culture, food and language after living in London, Sydney and Auckland.

As general manager of the Hungary office Watson was charged with setting up what was effectively a start-up service centre for finance, technology and operations for Europe and North America.

By the time she resigned in January 2009 there were 800 people working at the service centre. It was also the peak of the Global Financial Crisis.

"Investment banks were shedding jobs left, right and centre so it was probably a brave thing to do but we were committed and had bought a house in NZ so had something to come home to.

"It was lucky ANZ was looking for a financial controller at that time. I interviewed when I came home for Christmas, then started in April, 2009."

The recruiter suggested there might be a possibility of her moving up to the CFO role but Watson says becoming CEO wasn't on her radar.

"No, I was thinking I've got back and got a job."

Now that she has the top job Watson is clear on her priorities pushing through regulatory change and innovation to help customers do better with their finances.

"It is really interesting so many people say what is the bank going to look like in five or 10 years? It is hard to know the answer to that, other than it will be very different.

"The really important thing for us is we have got some very large compliance-driven projects that we have to deliver - whether it is the financial advisers regime or the credit contracts or BS11 [the RBNZ's mandate to bring outsourced components home].

"We also want to make sure we stay on the path of innovating and just making life easier for both our customers and our staff."

Using data to track what customers do and then pointing them in the right direction is a key part of that.

"We do it now with our serious saver account - tell people if they are not earning bonus interest. We will be able to amp that up so they are in the right credit card - there's no point in having an Airpoints card if you are not earning enough points to cover the fee."

Watson says in the past customers had to wait until a banker came and sat in front of them and then did the analysis.

Now that most people only frequent a bank branch twice a year the data can be used for that analysis and to email or nudge the customer to change their behaviour.

But she says there are also lines the bank has to be careful not to cross when it comes to data.

"Keeping it safe is so important...and the other thing is not doing creepy stuff with it - stories like you have had three transactions in this type of store in the last month, so you must be pregnant - you want to use it for the right purpose.

"We have got really tight governance processes around data. We have a lot of people coming to us asking if we can share it with them or if they can buy it off us. At this stage we don't."

Then there are the new bank capital requirements which start coming into force from July with a phase in over the next seven years.

Watson says ANZ held back 80 per cent of its profits to prepare for this last year and has the option to do so again this year.

There are still fears the change will lead to credit rationing, higher borrowing costs for some and others being locked out of the banking system.

"Over time there will be less lending in some places, will be higher prices in some areas and over time the shareholder should wear some of this. It will be mixed between the three outcomes over time. But we have got time to implement it."

Then on top of all that there are the worries of coronavirus, drought in parts of the country and flooding in others.

"Those types of things just add to the uncertainty and stress and show just how quickly things change. We have got packages out there, will work with customers. Droughts don't tend to last years in New Zealand. So it's a matter of time before it rains. For us it is about working through those things and being aware how quickly things change."

Amidst all the economic and regulatory changes and challenges Watson is cognisant that banks have suffered reputational damage in recent years with the findings of Australia's Royal Commission and criticism from regulators in New Zealand over conduct and culture.

ANZ chief executive Antonia Watson and her husband Tim Bartley. Photo / Norrie Montgomery

Asked how banks can come back from that, she is clear.

"It is on us to learn from the things that have gone wrong. Customers are at heart of everything we do. That is the change we are seeing across the banks."

Despite the big Australian banks owning the four big banks in New Zealand she points out that there are structural differences as well as the size aspect.

"In New Zealand everyone knows everyone so if you do the wrong thing it will be your mother's next door neighbour."

"That smaller society means you can get your arms around a bank of ANZ's size - and are less likely to have rogue areas. That said I completely appreciate banks have had a bad rap and that is for us to make sure we are telling the story about all the good we do in communities and that we do care about people's financial wellbeing.

"New Zealand's prosperity is our prosperity."

Antonia Watson

Role: Chief executive ANZ New Zealand
Age: 50
Family: Married to Tim
Education: Epsom Normal Primary, St Cuthbert's College, Otago University Bachelor of Commerce majoring in accounting.
Career: Worked for KPMG in New Zealand before moving to London to do her OE where she worked for Morgan Stanley in London, Sydney and Hungary. Began working for ANZ NZ in 2009 as a financial controller, moving up to CFO in 2012 and was appointed chief executive last year after a stint as the acting CEO.
What was the last movie you saw? JoJo Rabbit
What was the last book you read? The Other Bennet Sister by Janice Hadlow
Last overseas holiday? Japan