After just one month in his role, Ade Ayeyemi, Ecobank Transnational Incorporated's (ETI) new CEO says he feels firmly rooted in the group's culture. Although a Citigroup veteran for 27 years, Ayeyemi has "never once felt like an outsider since joining ETI," he says. "The main thing people should take from this is that I am dedicated to the continent, just like Ecobank. And through my role at Citi, I have continuously interacted with ETI and Ecobankers. I'm no stranger here."
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Ayeyemi seems clear on Ecobank's direction: "I know what we need to do. I have had many open discussions with Ecobank's management teams and they have all been open with me about their past achievements, future goals and even some of their missed opportunities," says Ayeyemi. "Their frankness towards me shows that I am one of the team."
Ayeyemi's statements on teamwork come while he sits in a room in London's Claridge's Hotel in early October. He has been preparing for his part in the CEO debate, part of the Financial Times Summit on Africa. It is one of his first high profile public appearances as ETI's CEO since he officially took over from Albert Essien on September 1 this year.
He insists that working as part of a team is pivotal to the group's future success - a theme that continually emerges during the interview. "It's like the old Africa proverb," says Ayeyemi. "If you want to go fast go alone, but if you want to go far, go with people. We have decided on the latter."
Ayeyemi is one of the continent's most respected bankers. Nigerian by birth, Ayeyemi is truly pan-African by experience. During his long career with Citi Ayeyemi worked in Kenya and Nigeria in transaction services, trade, treasury and country operations, before heading southwards to Johannesburg to head Citigroup's sub-Saharan Africa division in 2013.
Now as the CEO of ETI, Ayeyemi has made the move from the financial heart of Johannesburg, Sandton, to ETI's headquarters in Lomé, Togo. Once considered the Paris of West Africa, Lomé is still recovering from political turmoil in the 1990s that turned some of the city's charming European architecture into rubble. Some of the ruins are still waiting to be rebuilt.
"I don't think there are that many people who would make the move from the comforts of Sandton to Lomé, but it is the heart of ETI and it's where our origins are. For me, it is of the utmost importance to be at the centre of the organisation," says Ayeyemi.
What I can say is that the elephant is now dancing. We are delivering on our promises in terms of economic leadership, customer experience, and conduct Ade Ayeyemi, Ecobank
He claims this commitment has been reciprocated by the welcome he has received since joining ETI. "From the board of directors and the chairman to everyone else in the firm that I have had the opportunity to meet, I have been given the warmest welcome. Albert [Essien] has been so gracious with his time and attention to make sure that both my wife and I are in a position to settle in as well as we can. My wife is being taken care of in terms of relocation and I am getting to grips with the business," he says.
"We are both giving it our all. The more we all put in, the more we will both get out," he says.
His warm welcome is in stark contrast to his predecessor, Thierry Tanoh's dismissal. ETI's short-lived CEO was appointed in July 2012 and abruptly dumped in March 2014. Despite coming from the International Finance Corporation (IFC), one of ETI's main shareholders, where he was vice-president for Latin America and the Caribbean, sub-Saharan Africa, and Western Europe, Tanoh was considered more outsider than associate by some of his colleagues at ETI - a sentiment confirmed once he was finally ousted.
Under Tanoh, ETI nearly fell apart. Allegations of management fraud and poor corporate governance led to investigations by Nigeria's Securities and Exchange Commission and to a great deal of negative press coverage.
"It was embarrassing," says Christophe Jocktane-Lawson, managing director and cluster head international for Ecobank International based in Paris. "We were finding it difficult to look into the eyes of some of our international clients who continuously interrogated us on what was going on internally. None of us knew what was going to happen," he says.
Tanoh subsequently sued ETI for wrongful dismissal and defamation and has since been awarded more than $35 million in damages by courts in Togo and Ivory Coast. ETI has been trying to block $24 million of those awards in the UK courts and is believed to be seeking an out-of-court settlement with Tanoh.
The period of disorder culminated in Tanoh's dismissal and the appointment of Albert Essien, an Ecobank veteran. Essien has been considered by some as ETI's saviour - the voice of reason that brought the group back from the brink. "ETI suffered a near death experience," says Ayeyemi. "We can never go back."
"We" is Ayeyemi's pronoun of choice, perhaps even overused during the interview in an attempt to prove his alignment with Ecobank. Because Ayeyemi is not one of the elite group of long serving Ecobankers that includes the likes of Essien and Arnold Ekpe - the CEO who led Ecobank through a period of expansion before Tanoh's arrival - the question remains has Ayeyemi managed to settle as easily as he says?
Board members involved in hiring Ayeyemi publicly state that they have no doubt in his ability - and they took their time picking him out: "Ade Ayeyemi is a highly experienced banker with deep knowledge of banking across Africa, chosen to head the Ecobank group after a thorough and extensive search for a leader," says Emmanuel Ikazoboh, group chairman at Ecobank.
Mike Brown, CEO of Nedbank Group, a key shareholder in ETI puts it succinctly: "as shareholders we welcome Ade's appointment and look forward to working with him to grow the value of ETI."
One Africa analyst based in London observes: "I was in Accra just a few weeks back and there was quite a large Ecobank contingent - past and present - at the hotel where I was staying. You could tell from the buzz that came from them that there was a sense of hope and excitement around Ade coming to join the ranks. Ekpe was there, Essien was there, there were other key ETI players there, and there was a bullish sense that Ade would be able to lead Ecobank and the group into the next phase."
Ayeyemi's appointment marks a generational change, says the analyst. "It would have been easy to pick another guy that has been in ETI for a long time, but I think they needed a bit of a shakeup. Nevertheless, to stay away from any of the mistakes they made when choosing Tanoh, they would have made sure to have done their due diligence," he says.
"It's a matter of style," says Jocktane-Lawson. "Tanoh was someone that didn't know how things worked internally. Ayeyemi understands the DNA of the group. He has the technical expertise, the managerial expertise and can have real influence on how the group works." Indeed, Ayeyemi has something in common with both Jocktane-Lawson, Ekpe and some other Ecobankers - many of them have come from Citi.
"I am in a unique position because I bring the best of both worlds to ETI," says Ayeyemi. "I bring a fresh perspective to the group while drawing on my deep experience of the continent. As well as being committed to the continent, I believe this is another reason I was chosen - and chose - to take the job."
One area of expertise is his ability to put a positive spin on issues affecting ETI. On February 4 this year, an appendix to the IMF's pan-African banking report warned: "Ecobank group is one of the most rapidly expanding pan-African banks and this rushed growth with poor governance poses serious concerns. With the rapid scope of expansion, Ecobank is gaining systemic importance in many cross-border operations and the deficient supervision system is a major source of peril to financial stability."
"I think of it like this," explains Ayeyemi, "there is a plane carrying close to 800 people on one flight. You warn the pilot that this is an important journey and that he is carrying precious cargo. This does not mean you do not have confidence in the pilot, but that he has a lot of responsibility.
"The IMF was saying that we are systemically important and that we need to take that into consideration in everything we do. It was reminding us that if we want to be the dominant pan-African player than we have responsibilities that go beyond one country. We will not forget this," he says.
Just two days after its report was published, the IMF released something close to a retraction, praising ETI's positive steps to avoid risks to financial stability in a press release. The release even highlighted that the IMF report referred to internal governance issues at the bank dating back 18 months. "Whatever the IMF said afterwards, it's a message we live by," says Ayeyemi.
Among the reasons he had for joining ETI, Ayeyemi points to the strong shareholder base of the group: "The types of institutions that have invested in the firm are of the highest calibre. There is Nedbank, Qatar National Bank (QNB), South Africa's Public Investment Corporation and the IFC. This is a testament to the strength of Ecobank as the pan-African player in the region and I am honoured to be part of this," he says.
QNB increased its stake in Ecobank in September 2014 and in October of the same year, Nedbank converted debt given to the group into equity and bought additional shares to make up a 20% stake in ETI.
According to the new CEO, each shareholder offers expertise that is invaluable in an African context. "The Middle East boasts the highest level of concentration of capital in the world. QNB can bring this, but more importantly, it has the expertise in a region that we hope to do more business in. As for Nedbank, it has the network and knowledge in South Africa, one of the continent's most developed economies, and the PIC is one of the region's largest pension companies," says Ayeyemi. "As for the IFC, well, they're the IFC. Who wouldn't want to work with such a wide variety of people and institutions?"
Ayeyemi has some big shoes to fill. Over the past 18 months, Essien brought calm after the storm at a time when some thought the aftermath of Tanoh's departure meant the end for the group. Ekpe's legacy was one of bullish expansion. While some criticised the bank for extending itself too quickly, others argued that this is what transformed the bank into a truly pan-African player, adding 15 subsidiaries between 2006 and 2010. Now ETI has 36 subsidiaries across the continent. "Expansion in a short period of time may not have been as efficient as it could have been, but we've done it and I salute the courage of people who did it," says Ayeyemi.
Hands tied
Despite all of his enthusiasm, ambitious plans and hope for Ecobank's future, Ayeyemi has his hands tied to some degree. African banking is in a difficult situation. As commodity prices remain low, many African countries are seeing their currencies weaken - issues that affect ETI in particular because of its focus on trade finance and developing regional connectivity.
As a result, strategy will be conservative and efficiency will be central to future growth. Over the last year, Ecobank has managed to do quite well in this respect: first half results for 2015 show pre-tax profits up 22% year on year with operating expenses down by 8% in the same period.
One analyst predicts net profit growth at 19% for the full year. "We will soon be getting Ecobank's nine month results conference call where I think we will get some more colour from Ayeyemi, but I'm not sure that we will be getting anything ground breaking from him in terms of strategy," says the bank analyst based in Nigeria. "In this context, Ecobank should be focusing on survival," he adds.
Ayeyemi understands the need for continuity in this context; there are no immediate plans for expansion. "With more than 1,000 branches across the continent we already have a solid base to work from. We have a technology centre in Accra that is serving our whole network and we have 20,000 dedicated employers working for us. The only thing we hope to grow is our customer base and shareholder returns," he says.
To do this, there are some subtle, measured adjustments to strategy taking shape in Ayeyemi's mind. "Going forward we need to focus on execution. We need to strengthen our delivery capabilities and make sure that as many we can behave as one," he says.
Ayeyemi's plans focus on the bank's transaction services business, connecting the bank's subsidiaries across the region and highlighting the bank's pan-African nature. Another key area will be digital and mobile banking, something that will help keep costs down in terms of having to build branches across rural areas in the continent.
"But while we have a regional strategy, our approach in each country will be adjusted for a particular context," says Ayeyemi. "We have a huge presence in Nigeria, Ghana and francophone west Africa whereas in east Africa, in places such as Kenya we are small. While we look to maintain market share in the west, we will also need to become a major player in the east so we may invest more into Kenya."
For now, at least, there will be no transformational plans for Ecobank. Ayeyemi, at 52 years old, has at least eight years as CEO before he reaches retirement age as outlined in ETI's rules. So what does he think his legacy for the group will be? "It has been such a short period between Thierry, Albert and myself. At this stage I don't think it is that easy to discuss what my lasting legacy will be.
"What I can say is that the elephant is now dancing. We are delivering on our promises in terms of economic leadership, customer experience, and conduct. We are setting the example of African banking best practice and we need to continue to do this."
*Euromoney Institutional Investor
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