Former non-major CEO moves into payday lending

by Julia Corderoy14 Sep 2015
The former chief executive of Bank of Queensland has been appointed as the interim executive chairman of payday lender, Cash Converters.

Stuart Grimshaw – who resigned from Bank of Queensland in August 2014 – was appointed as part of a board shake-up in the wake of the payday lender’s long-serving chairman and Australia CEO Ian Day’s retirement, Fairfax has reported. Day retired last week after 23 years at the Perth-based company. 

According to Fairfax, Cash Converters has hired consultants CACE Partners to do a full review of the business over the next 16 weeks. This will then guide the company’s three-year strategic growth plan, with CACE and inform the market of its plans by January.

It will be a hard slog for Grimshaw, with the payday lender reporting a net loss of $21.4 million in 2015, down 188% from a profit in 2014 of $24 million.

In March, ASIC put the payday lending sector on notice after a regulatory investigation found payday lenders were “falling short” of meeting its compliance responsibilities under the NCCP.

In July, ASIC ordered Australia’s second-largest listed payday lender, Money3, to stop offering its two payments ‘fixed fee’ loan arrangement, and to refund more than $100,000 to consumers. 

In August, Westpac has confirmed it will no longer provide funding to Cash Converters and Money3 after conducting a thorough internal review into payday lending. 

According to Fairfax, Grimshaw has been on the board of Cash Converters since November 2014, when he became executive chairman at the Texas-based pawnbroker EZCorp. EZCorp is Cash Converters' biggest shareholder, owning 27.9% of the company. Grimshaw is now EZCorp's CEO.