Westpac has announced that CEO Gail Kelly will retire from her $13 million role in February 2015.

The bank chief will be replaced on February 1 by Brian Hartzer, who is currently chief executive of Westpac’s financial services division.

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Ms Kelly is the second highest paid CEO in Australia behind Macquarie Group CEO Nicholas Moore.

Chairman Lindsay Maxsted said Ms Kelly was one of Australia’s best CEOs, and was leaving the bank in good shape.

“Gail leaves the group in strong shape, and well placed to compete in the next phase of our strategy,” Mr Maxsted said in a statement.

Ms Kelly has led the bank for seven years.

She has led Westpac since 2008, and previously served as the CEO of St George Bank from 2002 to 2007.

Ms Kelly was the first female chief executive of one of Australia’s big four banks.

The South-African born executive’s career in Australian banking spans more than 30 years.

Under Ms Kelly’s tenure, the market value of Westpac has more than doubled from $50 billion to $104 billion. She told Fairfax she was delighted with the appointment.

“I’m delighted Brian Hartzer has been appointed to the role. Brian and I have worked closely during the past two and a half years. He is a proven leader and a wonderful fit for the Westpac culture. This is an exciting time for the Group,” Ms Kelly said.

Mr Hartzer, Westpac’s incoming CEO, previously served as Bank of Scotland’s retail wealth chief, and has also held senior positions with ANZ.

Mr Hartzer will take home an initial base salary of $2.686 million as well as up to $2.7 million of incentives when he becomes CEO in February. He will also be eligible for long term incentives.

Ms Kelly receives a salary of $13 million, which consists of a fixed pay of $3 million, $7 million worth of shares and $2.7 million in incentives.

Despite becoming the highest paid woman in Australia, Ms Kelly’s started her career as a school teacher in Zimbabwe.

She realised she disliked teaching and became a teller at one of South Africa’s biggest banks.

Ms Kelly and her husband decided to leave South Africa for their children’s future, arriving in Australia in 1997 with their four young children, three of them triplets.

She worked at Commonwealth Bank for several years, before moving to St George Bank as CEO, where news of her arrival caused the value of St George shares to skyrocket by $94 million.

Ms Kelly said she wasn’t retiring from public life and would continue her charity work.

“I’m just retiring from the CEO position. I’ll take my time in choosing other ways in which I can make a difference,” Ms Kelly said.