Tuesday, May 24, 2022

BoB governor in Stan chart internal politics

The Standard Chartered Bank Botswana (SCBB)’s localization and succession agreement with Bank of Botswana (BoB) was reported to be on the brink of collapse this week after one of the commercial bank’s senior managers, who it was speculated was likely to take over as managing director, handed in her resignation.

Rutang Moses, SCBB head of Compliance and Assurance, handed in her resignation on Thursday and will be taking an appointment as Chief Executive Officer with one of Botswana’s diamond sight-holders next Monday.

Moses would not be drawn into discussing her resignation and instead referred all comments to Ithabeleng Letsunyane, the bank’s spokesperson.

Letsunyane confirmed Moses’ resignation but insisted that this will not affect the SCBB’s succession plan.

Sources close to the bank on the other hand maintain that resignation has struck a fatal blow to SCBB’s localization and succession plan, which was derailed last month when the bank’s first choice for first citizen managing director, Serty Leburu, was rejected by Bank of Botswana.

The local media reported that Leburu failed the fit and proper test for the top post, but would not disclose details. It is believed that the information used to vet Leburu out was gleamed from her career at Debswana when she worked as Finance Manager at the Jwaneng Mine almost a decade ago. BoB Governor Linah Mohohlo also sits on the Debswana Board of Directors.

The decision by BoB to block Leburu’s appointment as SCBB’s first citizen Managing Director is understood to have dragged Mohohlo into SCBB’s internal politics.

The SCBB command is understood to have been interviewing some staff members on their relationship with the BoB governor, amid suspicions that BoB had blocked Leburu’s appointment because the Central Bank high priests had a preferred candidate for the SCBB top post other than Leburu.
The Bank of Botswana spokes person, Andrew Sesinyi told Sunday Standard that, “I am aware of the issue” adding that it is “impossible” that the Governor can manipulate the system to have her preferred candidate appointed CEO of Standard Chartered Bank. “I have seen the structure. I have seen the mandate and I can tell you, it is almost impossible.”

Sesinyi explained that BoB has a mandate to supervise commercial banks as part of establishing monetary stability. This is a statutory function that cannot be left to the discretion of the Governor. There are structure, procedures and principles that we follow.”

He said in the performance of its supervisory role, the BoB Act also provides for “appropriateness of personnel.” He explained that in carrying out their role as supervisors, it is not always possible to give reasons for their decisions because ‘we do not want to prejudice those whom we supervise. So it was not possible for BoB to give reasons on why it intervened against the appointment of Leburu.”

The SCBB’s situation is further complicated by the fact that the current expatriate managing director, David Cutting’s contract is up.

Cutting was appointed in May 2007 as a compromise candidate after the central bank governor rejected the appointment of a Ugandan, Lami Manjang, urging for a deeper localization programme.
Manjang was to replace Neil Jones who left the 165-year-old SCBB for Standard Chartered Dubai at the close of 2006. BoB explained that it rejected Manjang’s appointment because it wanted Botswana’s financial sector to be localized and made it clear that the next MD would have to be a citizen.

The then SCBB chairman, Vincent Seretse, had to plead with Linah Mohohlo for a compromise candidate who turned out to be Cutting. There were, however, specific instructions that Cutting be understudied by a Motswana for a period not exceeding three years.

In the third year, the Motswana understudy was to take-over, which would be a first in the history of SCBB. The agreement was in crisis this week as there seemed no one in the wings to take over from Cutting whose three-year contract is coming to an end.

Standard Chartered came into the country in 1895 and it has never had a citizen managing director. It compares badly with its peers, among them Barclays Bank Botswana, First National Bank of Botswana and Stanbic, which have all since localized their top most positions.


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