| Wed 3 Oct 2001, 0:00 | | African Bank Decentralises And Reduces Costs |
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PRESS RELEASE
African Bank is restructuring its Midrand central office and executive
management team, MD Leon Kirkinis announced today. The move, which
involves decentralising and devolving key functions to regional teams,
is designed to lower the bank's cost base by approximately 20% and
improve the responsiveness of the business to client needs. The effect
of these changes will translate directly into immediate and long-term
bottom line performance, the bank said.
The central office changes follow a complete restructuring and
upskilling of the bank's regional offices and branches over the last
six months, and reflect a shift in decision-making and management to
regional management teams.
"As with any business, we constantly have to look at the efficiency and
effectiveness of our various business units," said Kirkinis. "We are
turning the traditional corporate organisational model on its head and
decentralising into leaner and meaner bottom line- focused business
units. Although we will do our best to accommodate staff in the new
structures, and will look to offer them alternative positions in the
regional offices, there will be some redundancies."
The new African Bank executive team will be made up of Leon Kirkinis, Ed
Coetzer (Sales & Marketing), Victor Ramsingh (HR and Transformation),
David Lew (Collections), Pieter Marais (Risk & Compliance), Khomotso
Philela (Client Services) and Vernon Filter (Finance and Treasury).
Angus Herselman will head up a new collections company presently being
established by the bank.
"We have made these changes to take the decision-making process closer
to our clients," said Kirkinis. "This has also entailed moving some of
our best people into the regional structure so that we can focus on
delivering a better product to our clients in a shorter space of time."
Important strategic functions, including credit and risk management,
will continue to be managed from the central office, however the
devolved regional structures will become more directly accountable for
client service, product marketing, and profitability.
Kirkinis said that the cost-to-income ratio of the company had risen
substantially as the various businesses were merged into African Bank,
as changes to the Persal system came into effect, and as the bank
changed its business model to focus on retail markets. The recent share
buy-back has also meant that the bank is more highly leveraged in terms
of interest expenditure.
"Now that we have upskilled our business, and devolved greater
management control to the regions, we have the opportunity to
significantly reduce costs at the centre whilst increasing service
levels and advances growth. We are committed to a cost structure which
reflects the value added by the various business units to our bottom
line."
Kirkinis also announced that the executive team of team of Abil, African
Bank's parent, would be complemented by the addition of Johan de Ridder
and David Porteous.
Ends
Issued by: African Bank Media Relations
Tel: (011) 256-9050
For more information, please contact:
Leon Kirkinis
MD: African Bank
Tel: (011) 256-9240
