Zim will grow again: Stanchart boss

via Zim will grow again: Stanchart boss | The Financial Gazette – Zimbabwe News 4 Jun 2015

SINGAPORE-BASED Standard Chartered Bank Group’s head of retail clients, Karen Fawcett (KF), who is responsible for directing the global strategy and performance of the retail clients segment which spans more than 30 countries, arrived in Zimbabwe on Tuesday last week to familiarise herself with the Zimbabwe business. This is the first time a top executive from group level has visited the local franchise in 10 years. Business Reporter, Phillimon Mhlanga, (PM) caught up with Fawcett, who was accompanied by Standard Chartered Bank Zimbabwe chief executive officer, Ralph Watungwa (RW), for an interview. Excerpts:
PM: Welcome to Zimbabwe.
KF: It is my first time here, it’s embarrassing to say. At the moment, as management team, we are travelling across Africa. Each was given a country to go to and gain exposure before we meet in Nairobi, Kenya for a couple of days. So I chose Harare.
PM: Why Harare?
KF: Well, because it used to be one of the biggest businesses in the group and obviously we have aspirations that one day, it will be again.
PM: You are a member of the bank’s executive strategy group, overseeing business strategy, performance and resource allocation. Any plans to invest in the local unit?
KF: Let me talk about retail clients. What we want to do is to focus on affluent clients and small business clients who need the type of services. So people need an international network, they need advice on managing their investment or running their businesses and those are the type of clients who really fit well with the type of services that we offer. We are also very focused on (individuals) over corporate clients and hence there is a two pronged strategy which fits very well across Africa. We are bringing technology and we want to make sure that this franchise (Zimbabwe) is healthy as much as possible. We can see opportunities here so we keep focused on doing business with our clients and this is very important to us. We are also focusing on key cities in Asia, Africa and the Middle East where the economy will be the largest in the next few years. There are 100 cities which are going to be enormous by 2030. About 65 of them are in Asia. We are present in 43 of them. So our focus is getting depth in the most important cities and getting depth in terms of people in the right places, investing technology and having the right policy teams available.
PM: Why has Zimbabwe been excluded in the Power Africa initiative?
KF: Honestly that’s not my area exactly, that’s very much in the corporate finance team but I won’t view it as exclusion. Look, as a bank, we are very proud to be doing these things. A few years ago we did the (Bill) Clinton initiative; we were focusing on power and different types of energy and Power Africa is similar and it’s about us working with our international clients and see how we can support them as they come into these countries and in normal project financing and infrastructure financing.
RW: The (Power Africa) initiative was actually anchored in Tanzania and I think at the end of the day, the process was very clear that the sources of power in Africa are going to be shared a lot across most African countries. So they looked at the specifics and have chosen anywhere but from a resource point of view, there were certain countries that were supposed to lead it. By the way, since the launch of the initiative, it has doubled from US$2 billion to US$5 billion, which is a sign that we are totally committed to it and at the end of the day, I think that when that project expands, Zimbabwe will be one of the beneficiaries.
PM: Africa is contributing about 10 percent of group revenue. How much is Zimbabwe contributing?
RW: It depends on how much you look at it actually because if you look at it like Karen has said, this used to be a huge franchise in terms of contributions. If we were to measure it back then, probably it could have contributed 90 percent of Africa contribution but the reality of the situation is that because of the challenges we are facing in Zimbabwe, which is normal in the ecosystem, Zimbabwe’s contribution financially came down but that doesn’t mean in any way that it has become less important because as you know we value our franchise in Zimbabwe and some of the key things that I will mention is that having been here since 1892, we are the oldest bank in the country by any definition. So it means quite a lot for the bank. We believe that. As you have seen the investment has continued over the years when we had quite a serious crisis. It’s the belief that the bank in Zimbabwe will rise again and hopefully we will be there to see it contributing a lot more than what we are doing now.
PM: You have committed to exit 100 branches globally and in Zimbabwe you have already closed five branches. What benefit should stakeholders especially clients expect from this strategy?
KF: Let me put this in context. We have been very clear with our investors. We want to keep the bank profitable. There is an opportunity so we want to keep it in an efficient manner. We can’t call it branch closures but I would prefer to say we are housekeeping. We are taking branches from the old part of town or those that had very large footprint. You would find some branches which were 25 000 square feet. They were quite large but now we can have smaller locations in the latest shopping centres or central town. So we are moving from the large old fashioned format to a much more modern format substituting brick and mortar with much better technology which is what our clients want. Don’t view it as massive cost reduction. It’s more about doing things in a manner that will help our clients more. We are investing in the technology. We are bringing the best of our global technology to Africa first and gradually keeping investing in that, because this again reflects the way people want to work. So we are substituting the old way of working for a much more modern, convenient way of working. Most of our customers would prefer sitting at home with a cup of coffee doing transactions than driving in a long traffic jam trying to get to the bank.
PM: You said part of Standard Chartered Bank’s retail strategy is to focus on the affluent segment, why this choice?
KF: Well, because there are many banks in the economy and our strength and focus has always being an international bank. We are in 70 countries across the world. We do retail banking in 34 markets and we are in 16 markets in Africa. We do retail banking in 10 of them in Africa and the real competitive position over other banks is that we have a great network; we have very strong products and services. A lot of these come because of the strong spectrum we have got from the smallest retail client to large corporate. We can offer everybody the level of specifications they require. We also have excellent wealth management capabilities and we are bringing the world to cover clients in easy fashion.
PM: You seem to be hesitant to indigenise, do you have a problem with this?
KF: These are things that happen from time to time in many countries. We have been in those markets for a very long period and we have different corporate structures in different countries. So, yes I think one has always to try to balance. But it’s something that needs to be balanced. We run a global bank. We have a large number of shareholders. Therefore, this is why discussions are so difficult because there is a balance we have to get.
RW: I think it’s a process. Obviously, we are engaging with various stakeholders. We submitted our proposal way back. I am sure you are aware that (the information) is commercially privileged and therefore, it would be unfair to talk about the details of the plan but certainly, it’s something the authorities are fully aware of.


  • comment-avatar
    Mupurisa 7 years ago

    While it gives us some hope to hear positive things from influential people, perhaps this respectable lady would be a little better off if she spent a month or so in the country doing some ‘sightseeing’ and a bit more ‘research’ she may change her tune, or at least put things a little differently i.e. she would be more likely to say ; When Mugabe and ZANU PF are Gone, Zimbabwe MAY grow again!!

  • comment-avatar
    harper 7 years ago

    Of course it will grow again, its a resource rich country with a well educated population. But first it needs to die and be reborn and for the well educated population to return from abroad.