Top executives at pan-African lender Ecobank have asked CEO Thierry Tanoh to step down to resolve a crisis of leadership, according to an email sent by the bank’s deputy chief executive to its interim chairman.
The email, reviewed by Reuters, does not specify any grievance against Tanoh but alleges negative effects of long-running governance problems at the bank. It raises pressure on the leader of one of sub-Saharan Africa’s largest financial institutions before an extraordinary general meeting (EGM) on March 3.
Ecobank’s governance is in the spotlight partly because of an inquiry by Nigeria’s Securities and Exchange Commission (SEC). This began after its then finance director, Laurence do Rego, whom the bank had suspended, told regulators she had been pressured to misstate 2012 financial results. Ecobank rejected her accusations.
The SEC has yet to publish a report on its inquiry. However, it issued a statement in January saying there was an absence of a clear vision and strategy at the bank, inadequate transparency in recruitment procedures and conflicts of interest. It also cited weaknesses in the board’s ability to manage its own activities, monitor management, evaluate performance and oversee ethical behavior.
At the EGM in the Togolese capital of Lome, shareholders will vote on governance reforms to address the SEC’s criticism as well as on recommendations by external bodies including professional services organization EY that were hired by the bank to help its reform program.
The email seeking Tanoh’s resignation was sent on February 11 by Albert Essien, deputy CEO and executive director of corporate and investment banking, to interim chairman Andre Siaka. Neither Siaka nor Tanoh responded to Reuters requests for comment.
The email was signed by Essien and three other senior Ecobank managers: deputy group CEO and chief operating officer Evelyne Tall Daouda; group executive director for domestic banking Patrick Akinwuntan; and group executive director for operations and technology Eddy Ogbogu.
All four are on a five-member Group Executive Committee that runs the bank and is led by Tanoh. The committee members also sit on Ecobank Group’s board, which currently has 12 members.
Under proposals before the EGM to shake up the bank’s board, the four would all lose their seats. Tanoh would be the only member of the executive committee to remain on the slimmed-down, seven-member interim board.
In a second email in the chain, also reviewed by Reuters, Siaka forwarded Essien’s email on February 13 to company secretary Samuel Ayim, asking him to circulate it to the board. A senior figure at the bank, who asked not to be identified, confirmed the authenticity of both emails.
Essien, Tall, Akinwuntan and Ogbogu declined to comment to Reuters on the matter, referring queries to the bank’s communications department. “I would want to reiterate that I will not comment on the Ecobank Group outside of the official channels,” Essien said.
The three-paragraph email to Siaka said its signatories had engaged with the Group Chief Executive Officer (GCEO) Tanoh and asked him to consider stepping down as a solution to an eight-month crisis at the bank. The request was made before Tanoh and the board formalized its EGM resolutions, it said.
“We have indeed had several feedback sessions with the GCEO in relation to the state of the Bank and the negative impact that the long outstanding leadership and corporate governance issues have had on the business,” it said.
“We have contributed in building the Bank and wish to see it succeed. This will be possible if the situation comes to an end. We believe that the GCEO should now step down for the interest of the Institution,” the email said.
Ecobank said in September that Tanoh would forgo a bonus as part of efforts to rebuild confidence in the bank given the SEC investigation. Tanoh, a former vice president of the World Bank’s International Finance Corporation, joined the fast-growing bank in July 2012 and formally took over as CEO in January 2013.
It has expanded from its headquarters in Togo to operate in 33 African countries and is listed in Nigeria, Ghana and the West African regional exchange BRVM. Pre-tax profit for the first nine months of 2013 grew 56 percent from a year ago, while assets rose to nearly $20 billion in 2013 from $8.3 billion in 2008.
The bank announced in January that do Rego had left the bank in a brief statement that gave no explanation. She has declined repeated requests for comment. Former chairman Kolapo Lawson said Ecobank’s difficulties were not related to governance and it was wrong to pin problems on any individual.
He stepped down as chairman in October, saying he did not want to preside over the bank’s governance review process. “It is all a power struggle and that is how it has been from day one. People have amassed significant stakes in the institution and want to see how they can take control,” Lawson told Reuters, without saying who was involved.
“We don’t know who is going to come out on top,” he said, adding that the bank’s rapid growth and results undermined the SEC’s criticism and showed that the bank was ably led.