Absa Appoints Ex-Deputy Central Bank Governor Mminele as CEO
(Bloomberg) -- Absa Group Ltd. appointed former South African central bank Deputy Governor Daniel Mminele as chief executive officer in the midst of a turnaround strategy to expand in Africa and claw back market share.
Mminele, 54, will begin on Jan. 15, Absa said in a statement on Monday. The company has been led by another ex-regulator, Rene van Wyk, since February. Mminele joins after a six-month cooling-off period since leaving the South African Reserve Bank at the end of June.
Absa has been without a permanent CEO since Maria Ramos quit after leading the split from the lender’s former parent Barclays Plc. Ramos had started a strategic revamp to regain market share Absa lost in South Africa while it was under the control of the British bank. It’s also seeking to grow revenue on the rest of the continent faster than its Johannesburg-based peers.
The new CEO will first have to tackle key information-technology projects before pushing ahead with full force on Absa’s growth ambitions, Jan Meintjes, a portfolio manager at Cape Town-based Denker Capital, said by phone.
“They need to stay on top of that from a cost- and business-impact point of view,” he said. “He needs to strike that balance between getting these things finished and then try and get on the front foot to actually bring the bank in various areas into a position where it can compete effectively.”
Mminele becomes the first black CEO of Absa and only the third black person to take the helm of one of the country’s four biggest banks. Sim Tshabalala heads Standard Bank Group Ltd., the continent’s largest lender, while Sizwe Nxasana led FirstRand Ltd. until 2015. South Africa’s ruling party has been pushing to increase the participation of black people in the economy since the end of racial segregation in 1994, with the top leadership of listed companies still dominated by white men.
Mminele was responsible for financial markets and international-economic relations at the central bank, where he served two five-year terms as deputy governor.
He was seen as one of the favorites to succeed Gill Marcus as head of the Reserve Bank in 2014, a job that went to Lesetja Kganyago. Mminele, born in the town of Phalaborwa, which borders the Kruger National Park in South Africa’s Limpopo province, can speak English, German and Sepedi.
The father of twins was educated in Germany and at the London Guildhall University, and worked at African Merchant Bank Ltd. and Commerzbank AG before joining the central bank in 1999.
What Bloomberg Intelligence Says:
The appointment of former central bank deputy governor Daniel Mminele as Absa’s CEO provides the perfect opportunity for the lender to revamp its financial goals, in our view, with an emphasis on growth. Recovering lost market share, particularly in corporate channels where earnings fell 10% in 1H, and expansion in core African markets outside South Africa will be likely goals.
-- Philip Richards, banking analyst
-- Click here to read the research
Van Wyk will step down as CEO on Jan. 14 and help with the hand over until Jan. 31 before rejoining Absa’s board as a non-executive director after a six-month cooling-off period.
“Daniel will want to assess where we are in implementing that strategy and assess how he can play a role in strengthening the team’s ability to continue on that journey,” Chairwoman Wendy Lucas-Bull said in the statement. “He has a complete open mandate.”
Absa’s New CEO Appointment Paves Way to Growth Revamp: React
Shares in Absa fell 2.5% by 11:11 a.m. in Johannesburg in line with peers including Nedbank Group Ltd., which was down 2.4%, FirstRand, which dropped 3%, and Standard Bank, which was 2.1% lower.
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