Executive reshuffle at Absa

2009-11-14 13:21

BANKING group Absa continues to bleed executives with Hlengani Mathebula, the head of private banking, being the latest executive to hit the road.

Mathebula’s exit brings to six, the number of executives who have left Absa since last November.

These departures have made analysts concerned about a possible loss of institutional memory at a time when local banks have been hit hard by the recession, which has pushed bad debts in their home loans, car finance, and credit card divisions to levels not seen in the past 20 years.

Cash-strapped defaulters have punctured banks’ profits which, on average, have declined by as much as 30%.

But Errol Kruger, the Registrar of Banks, said although investor anxiety was understandable, there was no need to panic. “Absa is a well-run bank. It is not falling apart,” he said.

Kruger, who heads the Reserve Bank’s banking supervision division, said he had raised the issue of the resignations with Absa and has received assurances that the executives who have left will be replaced with equally capable ones.

“They will not fill the vacancies with people who are not suitable,” he said.

He said it was not the first time a South African lender had been plagued by executive departures.

Soon after Jacko Maree assumed the reins of Standard Bank in 1999, following the failed hostile bid by Nedcor, a number of its executives quit. “Maree had to groom young people and build a new team,” Kruger said.

Absa is expected to make an announcement this week about the restructuring of its executive team and the appointment of new people to vacant positions.

This new-look executive team will need the blessing of Kruger as no senior banker in South Africa is appointed without his approval.

In the last 12 months, Absa has seen six executives jumping ship. First to hit the exit door was Robert Emslie, chief executive of Absa corporate and business bank, who decided to quit in November last year, a week before Maria Ramos was announced the new Absa chief executive to replace Steven Booysen.

He left the bank in January this year, after 21 years of service.

Emslie was then followed by Riah Phiyega, head of corporate affairs, chief operating officer Peter Mageza, Absa Capital chief executive John Vitalo and communications boss Makhosini Nkosi.

On top of this, finance director Jacques Schindehütte is stepping down next March while Mathebula is leaving at the end of next month.

Absa also has the task of filling the position of chairperson of the board following the departure of Gill Marcus to head the Reserve Bank.

In a move seen as a strategy to calm investor nerves, Ramos in September appointed Louis von Zeuner, the former head of retail and commercial banking, as her deputy.

Von Zeuner, the most experienced Absa senior executive, is considered the lender’s kingpin by analysts as no one is said to pass through without his input.

The new executive structure that Absa is expected to announce will show some losers and gainers. Word from sources is that Venete Klein, the executive director for retail banking, will acquire new responsibilities. Gavin Opperman, head of secured lending, is expected to replace Von Zeuner as the new head of retail and commercial banking.

Ramos confirmed that Mohale Ralebitso, the executive director for marketing, will take over from Mathebula as head of private banking while Daphne Motsepe, who recently returned from a secondment to Barclays in London, has been appointed head of unsecured lending.

“It must be noted that due to the necessary approvals required for senior executives, Absa cannot divulge further appointments (both internal and external) that are pending, save to say we are comfortable with the composition of the candidates as this is in line with our transformation strategy,” Ramos said.

She dismissed speculation that Klein may quit the bank because of the executive appointments.

So far Ramos has filled Mageza’s job with Alfie Naidoo, former executive director for unsecured lending and new business cluster, and Vitalo’s position with Stephen van Coller, deputy chief executive of investment bank Absa Capital.

Vitalo was seconded by Barclays, Absa’s controlling shareholder, to head its Middle East investment banking operations.

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