Absa, SA’s third biggest banking group by market value, has sought the steady hand of tried and trusted lieutenants in its latest executive management shake-up as it adjusts to life after Barclays.
The company, run by Maria Ramos, said on Monday that it had appointed Charles Russon, an executive in charge of engineering services, to head its Corporate and Investment Bank (CIB), which is lagging behind its main competitors.
In the six months to June, it generated headline earnings equivalent to just about half those of Nedbank’s investment bank unit.
Paul O’Flaherty, who has previously served as CFO at Eskom and CEO of ArcelorMittal SA, will replace Russon as the head of engineering services and also join the executive committee. Earlier in 2018, he was linked with a return
to Eskom to replace Anoj Singh, who resigned under a cloud of Gupta-related corruption allegations.
"We knew they were looking for an experienced hire, and I think Russon fits the bill. The CIB franchise can become stronger if they keep the team intact.
"The market wants to see a solid and stable executive team in place," Patrice Rassou, head of equities at Sanlam Investment Management, said.
CIB is one of four operating divisions set up by Ramos in a restructuring that followed Barclays’s decision to sell down its majority stake and reduce its presence in Africa, part of CEO Jes Staley’s strategy to boost the bank’s capital and concentrate on its US and UK markets. "Our CIB business is an important driver of our growth ambitions across the continent, while engineering services is central to the transformation of our business into a digitally led bank," Ramos said.
O’Flaherty was chosen to spearhead the separation programme because it required complex separation of IT systems and other engineering programmes, Absa said.
The separation from Barclays is expected to be completed in 2020. "Absa’s separation from Barclays is a large and complex programme — we believe it is one of the largest of its kind in the world at the moment. It requires separating systems [such as IT], processes and policies to name a few areas, in addition to brands.
"Paul will oversee a number of services, processes and systems used across the group to ensure the smooth and efficient functioning of the business," Absa said.
Russon, a qualified chartered accountant, started his career with Merrill Lynch before working in London at Deutsche Bank for eight years, where he had roles in finance, fixed income, derivatives and trading.
He joined Absa Capital, CIB’s predecessor, in 2006 and has occupied senior executive roles including those of CFO and COO. Russon has been a member of the Absa executive committee since 2014.