Shares in Suncorp-Metway Ltd slumped after the banking and insurance group said its outgoing chief executive was leaving sooner than expected and an internal candidate for the top job signalled his departure.

Suncorp said John Mulcahy, who announced on February 5 he would step down as soon as a new chief was appointed, would leave on March 2 and that his vacancy would be temporarily filed by chief financial officer Chris Skilton.

But Mr Skilton, who was thought to be a candidate for the chief executive job, said he planned to also leave when the new head had arrived and settled in a new chief financial officer.
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Suncorp-Metway Ltd’s first half profit has declined by 32.8 per cent after the banking and insurer firm was hit by higher bad debts and claims surged because of severe weather events.

Net profit for the six months ended December 31 was $258 million, down from $384 million in the previous corresponding period.

The group had flagged the figure to the market earlier this month, when it also launched a minimum $900 million capital raising and announced that chief executive John Mulcahy would be stepping down.
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Banks could to forced to ration credit if conditions in world debt markets get any worse, according to Suncorp Metway Ltd chief financial officer Chris Skilton.

Mr Skilton said improvements in funding conditions for banks had partly reversed at the time ANZ Banking Group Ltd and National Australia Bank Ltd announced big writedowns.

“While further deterioration is unlikely, it clearly cannot be ruled out,” he told analysts.
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