NBK seeks to tap expat for managing director’s position
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National Bank of Kenya headquarters in Nairobi. The bank has placed an advertisement in the latest edition of the influential The Economist magazine in its search for a new managing director.
The National Bank of Kenya (NBK) has widened its search for a new managing director to include expatriates and Kenyans in the diaspora as it seeks new ideas to firm foothold in the lucrative corporate lending.
The bank has placed an advertisement in the latest edition of the influential The Economist magazine after running a similar job search in local media on January 20 to find a replacement for Reuben Marambii, whose contract is ending in December.
NBK on Tuesday said it was looking for a new managing director to lead its diversification into investment banking and insurance and to strengthen its presence in the homes loan market and corporate banking.
These offer big ticket lending at relatively lower cost.
The bank relies heavily on consumer lending, which accounts for 85 per cent of its loan book, for growth.
This has seen its rivals like Co-operative and Equity banks race ahead of it in recent years.
“We are increasingly looking at the international market to fill NBK’s top job given our diversification strategy that will require high competence in corporate banking,” said a director at the bank who declined to be named.
“Our focus here will be expatriates and Kenyans in the diaspora but this does not mean we are overlooking local talent. We are broadening our search.”
If it taps an expatriate, it will be following the path taken by then loss -making KCB—another bank with significant government shareholding—which hired Briton Gareth George from Barclays Bank to engineer its turnaround in 2001.
Analysts, however, reckon that the bank may be eying the growing list of Kenyans in the diaspora who are looking for opportunities back home.
“I think NBK is looking at Kenyans in the diaspora rather than expatriates especially given that its owned by the National Social Security Fund (NSSF) and the government,” said Kuria Muchiru, the country leader of PricewaterhouseCoopers (PwC).
Banks such as Equity have tapped Kenyans in the diaspora in the race for a larger share of the corporate lending market that is dominated by big banks like Barclays, Kenya Commercial Bank and Standard Chartered.
Last year, Daniel Odong’o joined Equity as head of corporate risk from Bank of America, while Henry Kimani, from Standard Chartered Bank (South Africa) was hired as general manager for corporate banking. It also hired Paul Njaga from BNP Paribas as finance director.
The hiring of executives from international banks is in line with its plan to replicate their business model in what could raise the stakes in the lending market.
Human capital has become the most sought-after resource for market share growth in the local banking industry in which business ideas are being copied with speed, sparking a talent war.
The NBK— ranked Kenya’s eighth largest bank by asset size— is also seeking to lend more to companies and big ticket projects in the property market to grow its loans book and push it to the top tier of the country’s banking sector.
In the nine months to September, the bank made a net profit of Sh1.23 billion compared to Sh1.35 billion a year earlier—which pales in comparison to quarter three performance of its peers like I$M Bank (Sh2.56bn), NIC Bank (Sh1.76bn) and DTB (2.17bn).
Its share has lost 55 per cent in the past year to drop to Sh20.25 on the bearish run at the Nairobi Securities Exchange (NSE) and the below analysts performance.
Mr Marambii was tapped from CBK where he was the chief manager of banking and was instrumental in returning NBK to profitability—which culminated in the bank paying its first dividend in 12 years in 2010.
The search for the MD is set to open a fresh battle between the Government and the NSSF over control of the lender’s executive suite.
The Government has for years influenced the appointment of the bank’s head on the strength that the lender is a State corporation, but the board of NBK--which is in the firm grip of NSSF -- insists that it will shepherd the search and make the final appointment without seeking the blessings of the Treasury.
