FORWARD LEADERSHIP
“ The stimulant in savings is the critical ingredient, much more so than the lending. I don’ t really see banks growing significantly because of the need to lend. But the drive to save money from the client base is the real game-changer, for banks and their clients,” says Mr Munro. Long-term savings products to be created by insurance and pension firms will pave the way for more corporates to issue debt and equity on local exchanges and, in turn, diversify the role of the region’ s banks.
Suitcase banking
Fears over an emerging market crisis coupled with stringent compliance regimes and entity-level issues have prompted some European and American banks to pull back from Africa. Meanwhile, Standard Bank’ s polar opposite strategy has given it an edge over its competitors. The bulge brackets still feature prominently on big-ticket deals and those involving multinationals, but it is harder for them to compete for the mid-sized clients that will push the continent forward. What is more, no other bank has an on-the-ground presence in the handful of countries that will determine sub-Saharan Africa’ s growth trajectory; that is, South Africa, Nigeria, Ghana, Kenya, Mozambique, Angola, and even Uganda and Zambia.
“ It has real scale with good diversification, but we can still get our arms around it. It is still agile enough to maintain a full grasp of it,” says Mr Munro, describing the bank.“ And I think one of the big challenges for multinational banks is high geographical dispersion and I don’ t feel at this point in time that that is a real challenge for us.”
What does still pose challenges in some markets are questions over governance and political decision making. Many of these countries have witnessed significant improvements in rule of law and democratic processes over the past decade, but in some it is still difficult to do suitcase banking – and often equally difficult to establish or buy locally licensed operations. Yet with a 153-year history in the continent, Standard Bank has proved itself capable of navigating such complex environments.
For Mr Munro, who celebrated his 20th anniversary at Standard Bank earlier in 2016, there are some are parallels between his situation today and when he joined the bank in 1996. Back then, he worked in its small risk trading division in London. As a chartered accountant by training, he had a unique perspective on what happened in a dealing room, which no doubt helped make him an invaluable part of the bank. Today, he again finds himself in a rare position. At a pivotal point in Africa’ s development, he is at the helm of the continent’ s biggest investment bank, which he had a key role in creating. After witnessing its expansion into Russia, Latin America and south-east Asia – using London as a launchpad – he joined the bank’ s leadership just as the global financial crisis began to unfold, and became part of the team that fundamentally changed the bank’ s business strategy.
It is something he views as an incredible opportunity, and one that the bank clearly made the most of. In revenue terms, Standard Bank’ s business outside of South Africa is bigger than that of its home country.“ We had the courage to make big decisions to change our game. And looking at it today, having had this footprint and invested so much in our bank and its purpose over the past five years, it is very rewarding and continues to excite me,” says Mr Munro.
“ That is a rarity. In financial services and banking, not many people around the world can say we have an incredible opportunity to deliver something remarkable that has a real and lasting impact on the local capital markets and beyond.”- The Banker
44 Business Times Africa | 2016