It is not just interest rates that are changing at Westpac, but also within the managerial level officials. The changes, announced on Friday by Westpac Chief Executive Gail Kelly, were timed with the release of the lender's 2011 annual report.

Leading the changes is the departure of Rob Chapman as head of the St. George Bank. Mr Chapman opted to leave the group and returned home to Adelaide after less than 18 months on the job. He is being replaced by George Frazis, who leads the group's New Zealand business.

Mr Chapman, who is also the chairman of the Adelaide Crows AFL Club and one of the major businessmen in South Australia, used to head Bank SA - the largest lender in the state.

The changes, though, are expected to cost Westpac huge relocation costs. According to the Westpac financial statement, the $613,184 non-monetary benefits paid to Mr Chapman for 2011 went mostly toward his relocation cost from Adelaide to Sydney.

Mr Chapman's relocation in 2011 also caused his loan balance from Westpac to grow to $7.9 million from $4.06 million, on account of the $4.1 million he spent for a waterfront apartment in Pyrmont, The Sydney Morning Herald reports.

Westpac is also expected to spend more for the relocation of Mr Frazis as well as that of Mr Frazis's replacement, Peter Clare who will move from Sydney to New Zealand, and also the move in Australia from UK in the coming months of former ANZ and Royal Bank of Scotland executive Brian Hartzer who will head Westpac's financial services operations.

Mr Frazis is reportedly New Zealand's highest paid executive and with a $3.54 million 2011 compensation package. He recently acquired a $6.45 million house overlooking Tamarama Beach after a dispute with his former landlord over a $3,400 weekly mansion overlooking Auckland harbour that he used to rent.

His high pay is apparently worth it because of a 41 per cent increase in cash earnings of Westpac's New Zealand unit under his lead. Mr Fraser has headed the unit for the past 3 ½ years. Ms Kelly spoke highly of Mr Fraser's performance.

"I am confident George's drive, energy and passion for developing high-performing teams and deep customer relationship will be a great asset to the St George Banking Group," The Australian quoted Ms Kelly.

Other changes in Westpac , effective April 2, include Mr Clare's role as AFS chief operating officer being taken over by Jim Tate, Westpac group chief product officer, in an acting capacity.

Industry observers are anticipating that Westpac, which sent offshore 126 jobs recently, would likely raise its interest rate despite last week's decision by the Reserve Bank of Australia to retain the overnight cash rate at 4.25 per cent.

RELATED STORIES