NO STOP­PING NX­AS­ANA

Finweek English Edition - - COVER -

Sizwe Nx­as­ana, who will be leav­ing as FirstRand CEO at the end of Septem­ber af­ter grow­ing the group into the big­gest bank in South Africa by mar­ket cap­i­tal­i­sa­tion, is not about to “go sit on a rocking chair and re­tire”.

Nx­as­ana, 57, who was orig­i­nally set to leave in 2017, is one of the coun­try’s most es­teemed ex­ec­u­tives. His track record i ncludes es­tab­lish­ing Sizwe & Co. in 1 989, r un­ning Telkom be­tween 1998 and 2005 (and over­see­ing its 2003 list­ing in Jo­han­nes­burg and New York) and found­ing the lead­ing au­dit firm SizweNt­salubaGo­bodo.

He will be fo­cus­ing on his fam­ily busi­ness and char­i­ta­ble trust, and hopes to work for “a few more decades”, he told Finweek in an in­ter­view. “There are a num­ber of op­por­tu­ni­ties, mainly in the fam­ily busi­ness space.” Nx­as­ana is mar­ried to his high school sweet­heart Judy Dlamini, a med­i­cal doc­tor-turned-busi­ness­woman, whose po­si­tions in­clude chair­per­son of Aspen Phar­ma­care. Their fam­ily in­ter­ests in­clude the Mbekani Group, with in­ter­ests in health, lo­gis­tics and prop­erty, and the Mkhiwa Trust, which sup­ports ed­u­ca­tion and health projects in ru­ral com­mu­ni­ties, mainly in KwaZulu-Natal.

Nx­as­ana joined FirstRand as CEO of FirstRand Bank, and took over as Group CEO when Paul Har­ris stepped down in 2010. Un­der Nx­as­ana’s watch, the group ex­panded into six coun­tries, ex­ited op­er­a­tions in Latin Amer­ica and Australia and re­ported a 23% an­nual

com­pound growth rate in earn­ings from R8.3bn to R18.7bn for the year ended June.

Di­ver­si­fy­ing the group’s ge­o­graph­i­cal foot­print hasn’t been easy. At­tempts to buy Nige­ria’s Ster­ling Bank failed in 2011, and FirstRand also failed to reach an agree­ment to buy Mer­chant Bank Ghana in 2013. In 2011, the late Zam­bian pres­i­dent Michael Sata can­celled FirstRand’s pur­chase of Fi­nance Bank in 2011, lead­ing to probes and un­cer­tainty over the deal.

De­spite the chal­lenges, Nx­as­ana has “ab­so­lutely no re­grets” about the group’s di­ver­si­fi­ca­tion strat­egy, which has re­lied heav­ily on or­ganic growth.

“We’ve al­ways main­tained that we’re not pre­pared to do deals at all costs. To us in FirstRand, pro­tect­ing share­holder value […] is more im­por­tant. So the fact that we have grown or­gan­i­cally in th­ese dif­fer­ent coun­tries − yes, it takes time, but we un­der­stand that, and we are very skilled at start­ing busi­nesses,” he said.

“Those busi­nesses are on track, they’re do­ing well − in fact some of them are even slightly ahead of where we thought they would be at this stage of their devel­op­ment, such as Zam­bia and In­dia as well as Nige­ria.”

FirstRand plans to start up bank­ing op­er­a­tions in Ghana by mid-year, and will be fo­cus­ing on scal­ing up and ex­pand­ing its other op­er­a­tions out­side SA.

The group also con­tin­ues to look for ac­qui­si­tion op­por­tu­ni­ties in Nige­ria, where the fall­ing oil price has led to a ma­jor de­val­u­a­tion of its cur­rency and com­pany val­u­a­tions. “We are more fo­cused on grow­ing our busi­ness − de­spite the lower val­u­a­tions, there are still big gaps be­tween bid and of­fer spreads,” said deputy CEO Jo­han Burger, who will suc­ceed Nx­as­ana. Rand Mer­chant Bank CEO Alan Pullinger will take over from Burger.

Nx­as­ana said that his ear­lier-than-ex­pected de­par­ture makes sense as part of FirstRand’s suc­ces­sion process, which started with the de­par­ture of Michael Jor­daan (for­mer CEO of First Na­tional Bank) and Brian Ri­ley (for­mer CEO of Wesbank) at the end of 2013. “It made it more ap­pro­pri­ate for me to step down now given where we are with the roll­out of our strate­gies. There have been a num­ber of changes in the group that I’ve been part of, and I just thought it was time for me to go and do other things, but also to cre­ate space for my suc­ces­sor to take the or­gan­i­sa­tion for­ward.”

Nx­as­ana is still con­sid­er­ing an in­vi­ta­tion to re­turn to FirstRand in 2017 as deputy chair­man. His ties to FirstRand founders Paul Har­ris and GT Fer­reira stretch back to the 1990s when they all served as non-ex­ec­u­tive di­rec­tors of the Natal Build­ing So­ci­ety.

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