Ramos firmly back in control of Barclays Africa

By Thebe Mabanga, ANA

 

Maria Ramos Copyright World Economic Forum www.weforum.org / Eric Miller emiller@iafrica.com
Maria Ramos Copyright World Economic Forum www.weforum.org / Eric Miller [email protected]

This week’s Barclays Africa’s annual general meeting served to illustrate how CEO Maria Ramos has taken control of the group after a turbulent phase of recovering from the recession and losing key executives in quick succession.

Since taking the reins in March 2009, the first year the effects of the recession were to be felt on the bottom line following the collapse of Lehman Brothers in September 2008, Ramos has arguably never looked as in control as she does now.

The numbers tell their story. In its results unveiled in March, the group reported 10% growth in headline earnings per share and a return on equity (RoE)  of 16,7%. This was some way off the group’s stated intention of delivering between 20% to 25% growth but, as chairman Wendy Lucas Bull noted, they were only in their first year of a three-year strategy. The South African operations were closer to the target with RoE of 18%, but that too was some way off the pre-recession RoE of 27%

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Absa has made progress in recovering lost market share in areas such as retail, where it was once the undisputed leader with more than 8 million customers. In the latest results, Ramos revealed that 43% of new customers were actually returning customers. That is a decent win back.

Where Ramos has taken total control is at the leadership level, stabilising her executive committee and almost shaping it to her image, as iconic CEOs do. But it has not always been this way. Even at the launch of the One Africa strategy at the 2011 results, Ramos did not seem in total control as some of her South African division were still losing market share to rivals. It did not seem entirely certain that Ramos would see through the implementation of the strategy she was unveiling.

Haemorrhaging of talent

The period between July 2009 and early 2012 was characterised by haemorrhaging of talent at exco, with high profile departures and disturbingly short stints at the top.

The departures started with chief financial officer Jacques Schindehutte, who later joined Telkom. The retirement of deputy chief executive Louis von Zeuner at the end of 2012 after 32 years with the bank was a particular blow, coming as it did when Ramos was at her weakest. It had come within a year of the departure of Gavin Opperman, the former head of retail noted for being fluent in Mandarin, who had been promoted to the exco in January 2010 and left in October 2011.

There were also the departures of Venete Klein, who had been at exco since 2005, Patrice Motsepe’s sister Daphne Motsepe, promoted in 2010 only to depart in 2012, head of marketing Happy Ntshingila, who was instrumental in the Absa Premiership sponsorship deal, and Alfie Naidoo, who was promoted in 2009, only to depart within three years.

Ramos was arguably at her most vulnerable in July 2012, when Barclays plc chief executive Bob Diamond resigned in the wake of the Libor scandal. Diamond was known to be a Ramos ally on the Barclays exco and fears were that a new regime may decide to effect change at its Africa operations. Thankfully, Antony Jenkins persisted with Ramos and gave her space to continue stabilising the business. That decision appears to be paying off.

It is worth noting that at the time that Maria Ramos was being buffeted by these storms, another female CEO of a large listed company, Cynthia Carroll of Anglo American, was facing upheaval of her own. She was also leading her company through recovery from recession, but was facing more open mutiny and shareholder revolt that had undertones of emanating from the “old white boys’ club”. Carroll eventually left after almost seven years in charge.

Diversified executive

Ramos now heads up a diversified executive containing mostly Absa or Barclays outsiders like herself. Willie Lategan, the chief executive for wealth investment management and insurance, is the longest serving member, having joined Absa in 1995.

Chief risk officer Anil Hinduja comes through parent Barclays plc and chief operating officer Charles Russon also has international banking experience through Merrill Lynch and Deutsche Bank. Human resources executive Sarah Louw is a Anglo American veteran, while Craig Bond was lured in to replaced Opperman about two years ago.

Nomkhita Nqweni, the chief executive for wealth investment management, as well as recently departed head of Africa strategy Kennedy Bungane, were drawn from the ranks of the Association of Black Securities and Investment Professionals, which Ramos would have encountered during her time as director general at National Treasury when negotiating the Financial Services Charter in 2003.

Nqweni was recruited from Alexander Forbes while Bungane came through Standard Bank. Bungane, the only notable recent departure, was brought in to lead the integration that led to the creation of Barclays Africa and left after three years to become chief executive of Pembani, the investment group formed by former MTN chief executive Phuthuma Nhleko. It would be hard for a banker with 20 years experience to resist such an opportunity.

The talent pipeline is equally rich, filled with the likes of Phakamani Hadebe, the executive for corporate and investment banking in South Africa, a Ramos protégé from treasury who turned around the Land Bank.

The AGM showed that shareholders are not yet eating of Ramos’s hand and the jury might still be out on whether Ramos has led the group to achieve its full potential, but it is certain that Ramos has firmly taken control of Barclays Africa.