MMI is going backwards

Sweeping changes to the executive as insurer tries to regain market share in places where it once dominated

MMI is quite different from the small Pretoria-based life office of the 1980s and early 1990s.

So it is no surprise that two veterans of those early days, Danie Botes and Etienne de Waal, have decided to move on.

MMI is now highly complex with a matrix structure made up of “centres of excellence” and business clusters, difficult even for insiders to understand.

It has absorbed at least three large insurers — Southern Life, Sage and then Metropolitan — as well as most recently Guardrisk, a specialist cell captive insurer.

The one that got away was Discovery, which started life as Momentum Health before it was listed by the then controlling shareholder, Firstrand.

And life is not as much fun.

Momentum was well known for lavish incentives, including Baltic cruises for brokers who sold enough linked investment products. And there is no longer the safety net of being part of the Firstrand group, which unbundled it in 2010. The banking group subsequently cancelled the contracts to provide life products through the FNB network.

MMI has re-entered the bancassurance market, on a much smaller scale, through its joint venture with African Bank, which will give it the chance to sell credit life and funeral policies in the African Bank branches.

All this might be treated as another chapter for seasoned executives.

But MMI is going backwards, with core headline earnings down 3% in the nine months to March. Momentum Retail, where Botes and De Waal cut their teeth, had flat returns. There was a 9% decline from a combination of guaranteed products and the Momentum Wealth linked products, as the group loses market share in a sector it used to dominate.

MMI CE Nicolaas Kruger says

Botes and De Waal left for personal reasons — and there is no doubt they were ready to leave an increasingly stressful group.

“Each wanted to move on so it made sense to let them go at the same time, giving us a chance to make all the changes at once. It is like a relay race and we have people ready to take the baton.”

These were senior jobs to fill: De

Waal was head of Momentum

Retail, Botes group chief operating officer.

But it gave Kruger the chance to appoint some people from outside the Momentum mould. Kruger says the new chief financial officer (CFO), former award-winning analyst Risto Ketola, grew quickly into his role as head of business performance and investor relations.

Ketola is possibly the first CFO in Gauteng of Finnish stock. The new group head of operations, Ashlene van der Colff, only came from as far as Braamfontein — she was divisional director for operations at Liberty Corporate before joining MMI to run internal audit last year.

The big promotion, however, goes to Mary Vilakazi, the outgoing CFO who becomes deputy CEO.

Vilakazi was still at primary school when Botes joined Momentum. She was appointed one of the youngest partners of accountants PWC in 2005 and was responsible for the Metropolitan audit when it was still a standalone insurer. But she also has experience outside financial services as CFO of the Mineral Services Group, a group of geologists.

Another key appointment is Khanyi Nzukuma as the new head of Momentum Retail.

He moves from Metropolitan Retail, where Kruger says he helped drive up volumes and profits. Metropolitan’s earnings are up a healthy 10% in the nine months to March and the recurring premium is up 17%. The culture and pro-