National Bank scraps deputy CEO post, hires corporate head


Mr Munir Ahmed. National Bank has scrapped two positions of deputy CEO and tapped the head of corporate banking from CFC Stanbic as it races to cut reliance on consumer lending.. FILE

National Bank has scrapped two positions of deputy CEO and tapped the head of corporate banking from CFC Stanbic as it races to cut reliance on consumer lending.

The mid-tier bank has replaced the two positions with division directors, including corporate and retail banking, who will report to chief executive Munir Ahmed who was appointed to lead the bank nine months ago from Standard Chartered.

National Bank has hired Samson Okero as director corporate and institutional banking from CFC Bank where he held a similar position, underlining its quest to hire talent from banks with heavy presence in company lending.

Isaiah Mworia, who served as deputy CEO for customer services, quit the bank last month while his counterpart, Ismail Noor, was nominated as principal secretary in the Labour and Social Security ministry.

The restructuring, which is being led by global consultancy firm McKinsey, is in line with National Bank’s new focus on big-ticket transactions such as home loans and business lending to rev up revenue growth.

Ranked 12th out of 43 lenders in Kenya, National Bank has declined from a top-three lender in 1996 as its model of focusing on government banking and personal lending was upset by newer and nimbler rivals like Equity.

“The company has also restructured by setting up retail business and corporate and institutional banking divisions… and has recruited new talent to strengthen the company’s capabilities,” noted Mr Mohamed Hassan, the bank’s chairman, in an earlier notice to shareholders.

The bank has since hired Robert Kibaara and Thomas Gachie to head retail banking and ICT respectively, both from Standard Chartered. National Bank follows in the footsteps of KCB Group in scrapping the deputy CEO’s position, which is a rarity in corporate Kenya.

The bank posted a 53 per cent drop in profit last year against double-digit growth in the industry before cheap deposits helped the lender post a profit of Sh368 million in quarter one compared to Sh327 million in the same period a year earlier.

The bank blamed over-concentration of lending to individuals for the profit drop in 2012, saying the bank was cutting back on personal loans and shifting focus to corporate debt, currency trading and custody business.

Wary of higher default levels, the bank could not raise lending rates for small borrowers who accounted for 80 per cent of total loans at a time when the cost of funds soared due to a jump in official rates.

The quest for a larger share of the corporate business is what led NBK to hire Mr Ahmed, who worked at Standard Chartered Bank for 16 years mainly in South Africa where he was director in charge of regional transaction banking for Africa’s operations.

He is expected to replicate StanChart’s business model that is heavy on corporate banking. National, which is 70 per cent owned by the government and National Social Security Fund, plans to raise Sh10 billion from a rights issue to fund expansion. Its share at the Nairobi bourse has gained 34 per cent over the past six months to Sh22.25, which is a gain of 1.12 per cent in the month.