Kenny Fihla’s appointment as Absa CEO reflects the lender’s desperation to steady its ship. After years of leadership churn that has left investors skittish and employees adrift, Absa’s board has opted for an outsider to tackle its entrenched cultural and operational dysfunction.
But Fihla will need every ounce of support from the board led by Sello Moloko to succeed in this high-stakes role. Without it, his tenure could end as just another chapter in Absa’s revolving-door leadership saga.
Let’s start with the obvious: Absa’s leadership instability has been a lesson in how not to run a bank. Six CEOs in as many years. That’s not a track record, it’s a crisis. The constant reshuffling has left employees disorientated, investors anxious and, in all likelihood, regulators raising their eyebrows. Fihla’s appointment is a chance to break this cycle, but only if the board backs him to the hilt. He’ll need the freedom to make tough decisions, the resources to implement them, and the patience to see them through. Anything else, and he’ll be just another name on the ever-growing list of Absa’s ex-CEOs.
Remember Daniel Mminele? The former central bank deputy governor who was at the helm of Absa in 2020, only to resign 16 months later after clashing with his executive committee over the strategic direction of the lender. Mminele was brought in after his predecessor, Maria Ramos, and the exco team, had conceptualised and begun to implement the growth blueprint. On his arrival, he tried to make changes to the plan, putting himself on a collision course with the team and giving us a real-world example of the risk involved in reducing the CEO role to that of a figurehead.
Fihla’s faces a Herculean task at Absa. The bank’s return on equity is among the lowest in the sector, its cost-to-income ratio is high, and its market share is under siege from both traditional rivals and digital upstarts like Discovery Bank. Fixing these issues will require more than a steady hand. It will need a complete cultural overhaul. Absa’s board must be willing to confront uncomfortable truths, challenge entrenched norms and support Fihla as he makes the radical changes needed to turn the ship around.
While Absa celebrates its new hire, Standard Bank is left to pick the pieces. Fihla was widely seen as the heir apparent to Sim Tshabalala, despite his proximity to the bank’s retirement age. Late last year, Standard Bank promoted Fihla to deputy CEO, handing him vast powers to run the company and inviting some to logically surmise that the board may be forced to reconsider the lender’s retirement age policy. Tshabalala described Fihla’s exit as a blow to the group.
For Absa, bringing in an outsider is a gamble, but it’s one the bank had to take. The board has rolled the dice, now it must ensure the odds are in Fihla’s favour. Because if Fihla, who grew earnings at Standard Bank corporate and investment banking division twofold, can’t succeed, one has to wonder if anyone can.
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