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South Africa’s Absa CEO leaves over strategy dispute after 15 months

AFRICA
By Reuters | April 20th 2021

Absa Chief Executive Daniel Mminele has stepped down, the bank said on Tuesday, a shock departure just 15 months into his post that sent shares in one of Africa's biggest lenders down as much as 5%.

Mminele, a former deputy central bank governor, took the reins at Absa from long-time boss Maria Ramos in January 2020 and was tasked with delivering on a turnaround strategy that had largely been laid down prior to his arrival.

Business Day newspaper and other media said he would leave after a rift with the board about Absa's strategic direction.

"It has become clear to the parties that there is non-alignment on matters of strategy and culture transformation," Absa said in a statement after announcing that the board was in talks with Mminele about his departure.

Absa has been trying to improve performance since splitting from its former British parent Barclays -BARC.L in 2017. Its efforts have in the past year begun bearing fruit, with the bank winning back lost market share in key products like mortgages.

Mminele, whose employment will end on April 30, would be replaced on an interim basis by Chief Financial Officer Jason Quinn, with immediate effect, Absa said.

The outgoing CEO said: "It is indeed regrettable that we should have had to part ways so soon on our journey. It is, however, important for the chief executive to be in complete alignment with the board on critical issues such as strategy and culture."

Mminele started at Absa just months before the coronavirus pandemic took hold. He made some changes to the bank's strategy as a result but it remained largely the same.

Absa investors, caught off guard by the announcement, said his departure created uncertainty, with one top 10 investors saying they were engaging with the board over this "serious matter".

Despite voicing concern about uncertainty, another major investor said the bank's commitment to the existing strategy was welcome. "The fact that ... execution on that strategy is continuing is probably a good thing," the person said.

Quinn has been at Absa since 2008 and its CFO since 2016. Prior to that, he was a partner at the accounting firm Ernst & Young. A new CFO would be announced in the coming days, the bank said.

Absa shares fell as much as 5% before recovered slightly to trade down almost 4% at 1112 GMT.

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