Daniel Mminele to lead Absa
In corporate SA’s worst-kept secret of 2019, former Reserve Bank deputy governor Daniel Mminele has been appointed permanent CEO of Absa Group and will take over the reins from interim CEO René van Wyk on January 15.
Absa formally announced Mminele’s appointment via Sens on Monday morning.
Speculation that Mminele was to be the permanent successor to Maria Ramos began almost as soon as Ramos stepped aside in February 2019 after 10 years as CEO of the bank that was for most of her tenure a subsidiary of British banking behemoth, Barclays Plc
In one of Ramos’s final acts, Barclays Africa Group negotiated a separation from Barclays which involved the parent company paying R12.6bn to fund the costs required to untangle hundreds of systems the two companies shared.
Absa had earlier acquired Barclays’s African operations in 2013, giving it an immediate presence in eight other African countries outside SA. Mminele brought down the curtain on a long and distinguished career as a central banker in June 2019, after serving in various capacities at the Reserve Bank for 20 years, the last 10 of which as deputy governor.
In some of the highlights of his time at the central bank, Mminele oversaw the monetary authority’s response to the global financial crisis and was intricately involved in crafting the successful bailout and rehabilitation of African Bank after the lender collapsed in August 2014.
In his final stint, he took responsibility for financial markets and international economic policy and relations representing the Reserve Bank at various high-level central banking forums alongside governor Lesetja Kganyago.
Kganyago said of Mminele in a letter to staff that he “has left an indelible mark on this fine institution and his contribution to the Bank has been invaluable and immeasurable”.
Mminele served a six-month “cooling off” period until the end of December 2019 as mandated by the Reserve Bank for senior executives switching jobs at any of the country’s key financial institutions.
In June 2019 Absa chairperson Wendy Lucas-Bull told Business Day that the bank was looking to recruit someone with the necessary “stature and recognition in the market” for the top job.
But Mminele has his work cut out for him. For a variety of reasons, Absa has lagged behind its competitors under the ownership of Barclays, and lost market share in several key product segments, including card, new vehicle finance and its flagship home loans business.
Ramos began to address this in the aftermath of the separation by using the occasion to initiate a “cultural reset” of the organisation. Besides restructuring, changes were made to the way employees are incentivised and rewarded.
This begun to turn in the interim period to end-June 2019. Home loan registrations grew at 16% during the period, more than double the growth in total home loan registrations in the country.
Mminele will now oversee the tail-end of the separation from Barclays and will inherit a structure that has involved Absa’s devolving its various businesses into three operating divisions: Retail and Business Banking led by Arrie Rautenbach, Corporate and Investment Banking (CIB) headed by Charles Russon, and the Africa regions led by Peter Matlare.
Van Wyk, will step down as CEO on January 14 2020, but will remain with the group as an executive director, for handover purposes until January 31 2020.