South Africa’s banking analysts were on Friday strongly divided over Standard Bank’s move to appoint joint CEOs to replace the retired Jacko Maree.
One analyst said it was a good idea because the two managers had complimentary expertise in their roles while the other rejected this idea, saying it was not viable.
Lisa Haakman, an analyst at Noah Capital Markets, told Moneyweb that the joint CEO structure was a good thing in the case of Standard Bank, Africa’s biggest bank by assets.
“Standard Bank especially is such a complicated animal, giving the responsibility for the whole group to one individual might have resulted in the person being stretched too thin,” she told Moneyweb.
“Consequently the division of duties between Sim Tshabalala and Ben Kruger makes sense as they have the expertise in those roles. Perhaps for the foreseeable future it was the right decision.”
However, analyst Johan Scholtz from Afrifocus Securities, differed, saying the joint CEO structure was a shocker.
“I would have thought that Sim Tshabalala has enough experience by this time that he would have been appointed CEO. You only have to look at the age difference between Tshabalala and Kruger to see what the long-term goal of this appointment is,” he told Moneyweb.
He was not sure about the viability of such a structure. He said people only had to look at other companies that have tried this structure to see that there are very few success stories.
International banks Deutsche Bank and Goldman Sachs have had joint CEOs in the past. But the joint CEO structure in the financial services sector is somewhat rare.
On Thursday Standard Bank Group (SBG) said Maree had retired with immediate effect after 13 years at the helm.
Chairman Fred Phaswana said that the board had agreed to use the structure of joint CEOs, appointing Kruger and Tshabalala to these positions.
Phaswana said that the board compared what they had internally with external options and decided to fill the CEO position in-house, but found that there were two candidates and appointing one over the other would cause the bank to miss out on the complementarity of the other, according to Moneyweb.
