On March 2, 2015, it was Ms Nilla Selormey. Now, it is her successor, Mr John Awuah, who is in her shoes.
After almost four years of a tough ride that included guiding Universal Merchant Bank (UMB) Limited to scale through the Bank of Ghana's (BoG) once dreaded December 31, 2018 deadline, Mr Awuah on February 1, said goodbye to his employer under a mutual agreement that obviously set the stage for a search for his successor.
In his stead, the Chief Operating Officer (COO), Mr Benjamin Kwabla Amenumey, has been made to act as Managing Director pending a substantive appointment.
With Mr Awuah’s parting, however, it appears the UMB is now rubbing shoulders with Access Bank Ghana Limited for the title of 'bank with the shortest-serving term for MDs/CEOs over the past five years.'
While UMB comes nowhere close to Access Bank in that regard (one of Access Bank’s former MDs, Mr Kris Ifeanyi Njoku, served almost five months; from July to December 2018), the bank's history should make the current successions at the top, a curious spectacle to analysts.
CEO as brand
UMB started out as Merchant Bank Limited until a controversial sale of the stake of the Social Security and National Insurance Trust (SSNIT) in 2013 saw Fortiz Private Equity Fund come in as majority shareholder with more than 90 per cent shareholding.
The sale was met with political resistance which culminated into a suit that was later dismissed.
It is interesting to note that the announcement of Ms Selormey as MD of the new UMB in 2013 was done hours after the suit was dismissed.
A smart, strategic and well-calculated move, the timing for the announcement was obviously chosen to help communicate the bank’s haste to put the court case and the controversy it generated behind it and set in motion, the new phase of the bank.
Since then, one would have thought that UMB would have prioritised continuity at the apex of management to help establish consistency, stability, brand identity and confidence in the minds of customers and the market in general.
It is worthy to note that in the business of selling and buying money, as is the case with other businesses, personalities count.
Once their tenure brings prosperity and smooth transactions to customers, such customers easily identify with the brand and personality.
This makes them comfortable transacting business with the institution.
Some even feel safer referring their colleagues to that bank due to the clout that the ‘known MD’ brings.
When properly done, it gets to a point where the MD’s name becomes synonymous with the bank, thereby making him or her a brand and an asset that the bank can strategically ‘sweat’ to attract and retain customers.
It also gives investors comfort.
The longevity of the MD helps with predictability, thereby assuaging fears of a possible change in the corporate direction of the bank and a general threat to their investments under a new MD.
Longest serving bank MDs
Talk of bank MDs becoming brands and their names synonymous with their banks brings to mind three names.
Mr Steven Sekyere-Abankwa of Prudential Bank, Mr Frank Adu Jr of CAL Bank and Mr Alhassan Andani of Stanbic Bank Ghana are the three longest-serving MDs in the country.
While Mr Sekyere-Abankwa has been MD for 22 years (1997 to date), Messrs Adu Jr and Andani have done 19 years (2000 to date) and 15 years (since 2004) respectively.
Suffice to say that their longevity, which is now being threatened by a new central bank rule though, has ensured stability, and generally impacted positively on the brands and bottom lines of their respective brands.
Thus, as a young brand aiming to stabilise in a highly volatile market, one would have thought that the board and shareholders of UMB would prioritise stability in the MD position rather than aiming to appoint a third MD in the sixth year of the bank’s new life.
A hand of GAT?
Beyond the need for stability, the timing of Mr Awuah’s exit raises more questions than answers.
As one of five indigenous banks benefiting from the Ghana Amalgamated Trust (GAT) Limited support, 2019 will surely be an abnormal year for UMB.
Unlike other years, this year will be one in which the management and the board of the bank would have to submit to a tough due diligence exercise, relinquish some stake in return for funds under tougher circumstances and welcome on board a new shareholder whose interest is primarily to invest, reform, revamp, recoup and exit within five years.
As the person who led the management to agree to this tough GAT support, one would have thought that Mr Awuah would have, as well, led the management into, at least, the first years of that programme.
But as it is now, he has exited at a time UMB has not yet even signed any agreement with GAT.
This begs the question if the GAT support, through which UMB made it past the December 2018 deadline, has taken its first casualty in the person of the ever-smiling Mr Awuah.
This is especially so because as part of the GAT support, the government-backed special purpose vehicle (SPV) is aiming at impacting governance, management and operations in the five banks to help deliver value to its yet-to-be named investors.
Under those three thematic areas, GAT is allowed to veto appointments to key positions but only after an agreement has been signed, Mr Kofi Osafo Sampong, the Transaction Advisor, told GRAPHIC BUSINESS on January 6.
However, the fact that UMB has yet not signed any agreement with GAT means that it is unlikely that the MD’s exit has anything to do with that arrangement.
It surely, however, has something to do with Mr Awuah on one hand and shareholders and the board on the other hand agreeing that ‘it is time to say goodbye.’
As one source said, “it gets to a point where you just shake hands and say goodbye and then life continues.”
It is obvious UMB and Mr Awuah got to that stage on February 1.
For those of us outside, it will be unfair to say there will be losers.
In the same vein, it will be unfair to say UMB is better off in the eyes of the public (who may never know the actual story) and the GAT team without Mr Awuah.
This is especially so when his exit was abrupt to everyone, including staff.