At least 24 senior managers have left Family Bank in the past two months as the lender seeks fresh ideas and talent to grow market share.
The reorganisation plan is the culmination of a major strategy and business review plan that the bank’s new CEO Peter Munyiri initiated in July, aiming to widen its product offering to include home loans, corporate banking and forex trading.
The changes are Mr Munyiri’s first show of hand since he took the company’s top seat from Peter Kinyanjui, who had modelled the bank’s business around micro-finance.
“The exits are underpinned by the fact that we could not find internal skills to drive our business in forex, treasury, credit and corporate banking,” said Mr Munyiri in an interview with the Business Daily on Monday.
“Besides, we have invested in a core IT platform (Oracle) that has reduced the need for some roles in our business,” he said.
Mr Munyiri said 24 management staff and an equal number of rank–and-file staff had left the bank since July and that some had been offered agency business opportunities as part of their exit package. Those who have left include four heads of departments—Joyce Kamau, Keriri Muya, John Wachiuri and Harun Njuguna— who headed human resources, marketing, audit and debt recovery departments respectively.
Family Bank has recruited at least 10 C-level executives and heads of departments from rival banks to handle corporate, treasury, mortgage, and agency banking functions.
Mr David Thuo, formerly group treasurer at Kenya Commercial Bank, is the new head of treasury, Mr George Laboso is the chief of mortgage having served as head of sales in KCB’s home loans division, while Mr Samuel Burnei heads the micro-finance division.
Other executives are Mr Apollo Ongara, formerly a risk executive at Barclays Bank who now heads Family Bank’s credit function, Mr Timothy Kihiko, corporate banking chief, Mr Steve Gakuya (agency banking), and Ms Ruth Murage, chief of institutional banking.
They have been tasked with driving growth in the retail market while seeking a slice of the corporate market that is dominated by big banks like Barclays, KCB, Standard Chartered and Equity.
“Our customers have been seeking other banking services from our rivals, this will stop and we will exploit our strengths such as our vast branch network to get a footing in the new business lines,” said Mr Munyiri, adding that bank will hire 115 new staff to support its expansion, including opening seven branches by December.
The bank, whose products have targeted the low end of the market, has been searching for new avenues of growth since a consortium of investors including PE fund AfricInvest, FMO of the Netherlands, and Norway’s Norfund bought a 22.4 per cent stake for Sh916 million last October.
The cash was used to boost Family Bank’s IT infrastructure and to shore up its capital base to enable it tap into mega lending deals.
A stronger Family Bank is looking at lending more to companies and big ticket projects in the property market to grow its lending book and push it to the top tier of Kenya’s banking sector.
Central Bank of Kenya places its market share at 1.4 per cent compared to KCB (13.9 per cent), Barclays (10.7 per cent), and Equity (9.49 per cent).
The bank is tapping former executives of top tier banks as it seeks 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 Kenya’s banking industry where business ideas are being copied with speed, sparking a talent war.
Family Bank has been modelling its strategy on that of Equity Bank, which has upset Kenya’s conservative financial sector with the roll out of products that are popular with the low end of the market which has traditionally been considered high risk.
It plans to list at the Nairobi Stock Exchange by the end of October and announced a 15.4 per cent growth in half year net profit to Sh187 million