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Posted: 2017-07-22 00:31:32

As premier of NSW, Mike Baird helped pioneer "asset recycling", privatising public assets such as power stations and reinvesting the proceeds in new infrastructure.

Now, as an executive at National Australia Bank, Mr Baird is looking at ways the bank and its clients may benefit if governments overseas, or in other Australian states, follow in the privatisation footsteps of NSW.

Baird's pay kept secret

The head of the NAB has refused to reveal how much former NSW Premier Mike Baird will be paid as the bank's new chief customer officer.

Mr Baird, who started as chief customer officer of NAB's corporate and institutional business in April, said on Friday that a key priority for the division would be the likely growth in infrastructure, where the bank acts as a financier and an adviser.

After resigning as premier in January, partly because of the "strong personal cost" of the job, he also said that returning to banking following a 10-year stint as a politician had been "incredibly positive" for his family, giving him greater control over weekends and allowing a more normal social life.

Institutional banks have faced weak conditions in recent years, and Mr Baird said the division he led was "tilting" towards infrastructure, and the large funds that tended to invest in this sector, as part of a strategy to improve returns. 

Mr Baird this month visited the United States to explain how asset recycling works to government officials, after the Trump administration signalled an interest in the Australian privatisation model - which could lead to a wave of US infrastructure investment.

"People are interested and have heard about the story ... the NSW story and the Australian story," he said.

"We met with officials across federal, state ... and local authorities. They're trying to understand the context of how does asset recycling get done and what does it mean and what's the sort of narrative."

Joining Mr Baird on the trip was Industry Fund Management, a NAB client and major infrastructure investor. Mr Baird said he was "optimistic" about the potential for asset recycling in the US, where the federal government may use a similar strategy to Australia's and pay incentives to states that undertake asset recycling.

"I expect growth, I expect opportunities in the US, but the exact make-up of the portfolio is to be determined," he said.

Goldman Sachs analysts this month estimated public-private partnerships in the US could spark $US600 billion ($760 billion) in investment over the next decade.

NAB was looking at the potential for such projects, and when they might occur, in order to serve its clients, he said. The bank would stand to benefit from asset recycling by helping to fund deals, as well as arrange other products such as bonds, foreign exchange or conduct advisory work.

People are interested and have heard about the story ... the NSW story and the Australian story.

NSW has signalled it does not plan further privatisations, but Mr Baird said he would be open to privatisation deals with other state governments in Australia.

"It's up to the other states, really," he said. 

Victoria and South Australia have both flagged plans to sell their land titles offices, and Mr Baird said NAB would support its clients if they were keen on such investments.

"Wherever our clients are looking for those opportunities, we'd support them," he said.

Mr Baird first started at NAB as a graduate in 1989, and said it had not taken long to become familiar with banking jargon again.

He said he'd been made to feel welcome in the office though "hot desking" had been an adjustment, and he was occasionally stopped for "selfies" while on the job.

"The team have at times commented that when we're going out to see clients, they're not quite used to being stopped for selfies on the way," he said.

He said the new job was "demanding" but he now had much more flexibility on weekends to go to family and social events, whereas doing this as premier would have been "very questionable". 

Upon joining NAB, Mr Baird underlined the need for banks to rebuild public trust, and on Friday he said there was still "a long way to go" on this front despite the industry's awareness of the need to change.

"We need to get to a position where the community is actually aware of what good banks are doing," he said.

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