TymeBank CEO Sandile Shabalala, resigned on Tuesday, less than four months after the launch of the digital bank.
This raises questions about the fate of the growth blueprint that he was spearheading.
TymeBank is one of three digital, app-only banks trying to muscle into the sector dominated by established brick-and-mortar banks that have reigned unchallenged since at least the early 2000s.
Shabalala’s departure also leaves the company, owned by tycoon Patrice Motsepe, in the middle of a fee-cutting price war with traditional rivals and crafting lending products that industry players have said were a sure bet towards profitability.
The resignation announced on Tuesday could prove unsettling and thus affect the bank’s growth, analysts say.
"It is definitely disruptive, especially at CEO level," said head of research at Bengual Global Fund Managers, Karl Gevers. He said it was too early in the bank’s journey to change CEOs, given that this was the person charting the strategy. TymeBank has won nearly half a million customers since its launch in February with cash-strapped consumers flocking to its zero-fee bank accounts while its generous interest rates on savings accounts lured thousands of savers. It is on course to start trying out credit products next month.
Shabalala, who was recruited to the company in 2016 when it was still just a money-transfer outfit, stayed on as CEO after Motsepe’s African Rainbow Capital (ARC) took over the entire company from Australia’s Commonwealth Bank in 2018.
ARC said that Shabalala had resigned for personal reasons as he wanted to spend more time with his family. Harry Botha, banking analyst at Avior Capital Markets said that Shabalala, a former Nedbank Business executive, would have been invaluable for TymeBank when the time came to launch its product offering for small and medium enterprises.
Tymebank, which has so far launched a consumer-banking offering, indicated previously that it will enter the business-banking space, but will serve only SMEs. It has chosen not to venture into the corporate-banking level.
Botha said that he was surprised by Shabalala’s resignation, and he thought it could disturb TymeBank’s growth trajectory. But he said there was a "strong team" remaining, and together with ARC as a shareholder he thought they would manage the transition.
"I think they have enough oversight to make sure that things don’t get too disrupted or derailed by strategic changes," said Botha.
TymeBank said that its deputy CEO, Tauriq Keraan, will manage the transition period together with Shabalala, who will serve his notice until a new CEO is appointed.
Keraan said that TymeBank will continue to implement the business strategy agreed on under Shabalala’s leadership. The bank also announced the appointment of three new board members, who are former Nedbank executives.
Nedbank’s former chief governance officer Thabani Jali was appointed chair and independent nonexecutive director of the TymeBank board. Former Nedbank CEO Tom Boardman will be his deputy.
Boardman is also a nonexecutive director serving on the ARC board.
Former Nedbank chief risk officer Philip Wessels will also become an independent nonexecutive director.
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