Fihla gets greater powers at ‘Big Blue’
• Standard Bank CIB head is now well placed to succeed group CEO
Standard Bank’s corporate and investment banking (CIB) head, Kenny Fihla, has been handed more power at Africa’s largest lender by assets in a serious vote of confidence in his leadership acumen, putting him in the pound seats to succeed group CEO Sim Tshabalala.
After a decade in the role, Tshabalala is set to dedicate more of his energies to the bank’s sprawling rest of Africa portfolio, among other priorities, and to assign more of the group’s responsibilities to Fihla.
This comes as the “Big Blue”, as Standard Bank is referred to in financial services circles due to the sheer size of its balance sheet, sharpens its strategy for the next five years.
Business Day understands that Tshabalala a few months ago informed the bank’s workforce that Fihla would assume more responsibilities.
In a letter to staff, Tshabalala said Fihla would play a more pronounced group role to ensure that the bank covers all bases and stays competitive.
“Given everything we need to achieve over the next five years, and given the evolution of my role, I have asked Kenny Fihla to assume increased accountability at a group level and to play a broader role within Standard Bank Group, while remaining accountable for the CIB business and achievement of CIB’s aspirations,” the letter says.
“This will enable me to spend more time on aspects of my role that now deserve a higher level of attention, including the growth and governance of our Africa Regions portfolio.
“This represents a natural development of Kenny’s role. In recent years, Kenny has taken leadership of the group’s relationship with ICBC [Industrial and Commercial Bank of China] and has joined the board of ICBC Standard,” Tshabalala wrote.
ICBC, the world’s largest bank, invested in Standard Bank in 2007, buying a 20% stake for $5.5bn. It has been one of the largest single foreign direct investments in Africa to date.
Tshabalala said there will be a leadership shake-up in CIB due to the expansion of Fihla’s role.
“In order for Kenny to have the capacity to play this broader role, and to ensure he achieves the right balance and focus between his CIB role and group responsibilities, he will be making certain executive changes within CIB. Kenny will be making further important announcements in this regard.”
In the group’s 2022 annual report published last year Tshabalala said there had been several instances of poor conduct and poor risk management at some of the group’s Africa Regions businesses.
“None of these were material at group level, but it became clear that controls had deteriorated in a few countries. We are completing a comprehensive programme to address these weaknesses and, again, significant changes to structures and to leadership have been made.”
Fihla, who had a stint at the City of Johannesburg early in his career, joined Standard Bank in 2006 as head of investor services at CIB. In 2007, he was appointed to the CIB executive committee and in 2008 became head of transactional products
and services SA for CIB.
He was appointed deputy CEO of CIB in November 2016, and from May 2017 assumed the role of CEO, running the biggest corporate and investment banking business in Southern Africa, with operations in 20 African countries.
Asief Mohamed, chief investment officer at Aeon Investment Management, said Tshabalala’s recent actions signal a commitment to transparency, accountability and talent development within Standard Bank.
Such steps, coupled with a focus on Africa’s immense growth potential, bode well for the bank’s future success and its ability to deliver consistent returns for shareholders.
“Demanding greater accountability from Fihla and others reflects confidence in the internal leadership development programmes at Standard Bank. This signifies a commitment to nurturing talent within the organisation and empowering future leaders.
“It is encouraging to see Standard Bank invest in its own talent pool, fostering a sense of loyalty and dedication among its employees,” he said.
“Tshabalala’s focus on the growing opportunities in Africa holds significant promise for boosting shareholder returns. Africa boasts a rapidly expanding middle class, increasing urbanisation and rich natural resources. By capitalising on these trends, Standard Bank can position itself as a key player in the continent’s future economic growth. This, in turn, can have a positive impact on shareholder value,” Mohamed said.
Makwe Masilela, chief investment officer and founder of Makwe Fund Managers, said Fihla’s expanded role is the bank’s gradual succession planning as it is wise to have a pool of potential candidates instead of one individual.
“It is also a way for Tshabalala to free himself ... to focus on growing their competitiveness, especially in Africa ... given the many opportunities that the Africa free trade agreement presents in the continent. The African competitiveness also applies to Fihla,” he said.
The move to broaden Fihla’s role is nearly similar to when Standard Bank had two copilots at the helm, Tshabalala and Ben Kruger. The two took up their joint roles in 2013 after the retirement of Jacko Maree, who had led the banking group for more than 13 years. Kruger stepped down as joint CEO of the lender in September 2017, leaving Tshabalala as the sole leader of the banking behemoth.
The lender’s results for the six months to end-June showed that its banking operations in 19 other African countries earned the group more than its SA operations, contributing 44% of its headline earnings.
In 2012, gross loans from the rest of Africa represented 13% of Standard Bank’s loan book, and that has now grown to 20%. In terms of deposit liabilities, the Africa Regions’ deposit liabilities in 2012 contributed only 15% to Standard Bank, but that has now grown to 22%.
The group has over the years increased the capital it deploys to Africa Regions. It consumed only 15% of total capital deployed by the group in 2012, but this grew to 27% at end-June. It has 7.2-million clients on the continent, excluding SA, R474bn of assets under management and net loans of R322bn in the 19 countries in which it operates in the rest of Africa.
The group employs more than 50,000 people in 20 markets on the continent, including SA. The lender’s Africa region is headed by Yinka Sanni, who is based at the group’s headquarters in Rosebank, Johannesburg.
In the past two years Standard Bank has been strengthening its leadership team. In July 2022, it appointed Margaret Nienaber as COO, a position that had been unoccupied for nearly a decade until then.
Standard Bank had not responded to requests for comment by the time of publication.