New CBN guidelines trigger retirement ‘Tsunami’ in banking sector

…Agbaje, Ikpe, Wigwe, others affected

Many top bank executives and non-executive board members are set to be caught up in a wave of mass retirement following new guidelines issued by the Central Bank of Nigeria (CBN).

Sources revealed that the current DMD of First Bank, Francis Gbenga Shobo, who joined the Board in 2012 is affected by the new guidelines and expected to proceed on immediate retirement.

By the new CBN guidelines, Mr. Shobo has served in the executive management for 12 years – two years beyond the stipulated 10-year tenure.

Also expected to proceed on immediate retirement is Ms Adaora Remy Umeoji, DMD, Zenith Bank. Ms Umeoji was appointed ED in December 2012.

By the new CBN guidelines, Ms Umeoji has exceeded the stipulated 10-year tenure and is expected to proceed on immediate retirement.

The Managing Director/CEO, Fidelity Bank, Ms Nneka Onyeali-Ikpe is also affected by the new guidelines.

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Segun Agbaje, Group CEO, Guaranty Trust Holding Company Plc, who was appointed ED of the bank in 2000 is caught up with the new guidelines and is expected to relinquish his current position.

Mr. Wigwe left Guaranty Trust Bank as an ED to co-lead the transformation of Access Bank Plc in March 2002 as DMD. He is currently the Group CEO,

Jim Ovia, currently Chairman, Zenith Bank, was the founder and pioneer MD/CEO of the bank from 1990 to 2010 when he moved into the chairman role.

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Abubakar Suleiman, MD/CEO, Sterling Bank became ED, Retail Banking, in January 2013 before he was appointed CEO in April 2018.

Ladi Balogun, Group CEO, FCMB Group Plc, became CEO, First City Monument Bank Limited from 2007 to 2017 and is expected to relinquish his present position in line with the new CBN guidelines.

The guidelines, contained in a circular entitled “Review of Tenure of Executive Management and Non-Executive Directors of Deposit Money Banks in Nigeria” dated February 24, 2023, specified the tenure of Managing Directors (MDs), Deputy Managing Directors (DMDs), Executive Directors (EDs) and Non-Executive Directors (EDs) of banks and financial institutions.

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The guidelines, among other conditions, stipulate that the tenure of Executive Directors (EDs), Deputy Managing Directors (DMDs) and Managing Directors (MDs) shall be in accordance with the terms of their engagement approved by the Board of Directors of the banks, subject to a maximum tenure of ten (10) years.

The guidelines further states that where an Executive who is a DMD becomes the MD/CEO of a bank or any other DMB before the end of his/her maximum tenure, the cumulative tenure of such Executive shall not exceed twelve (12) years.

“However, for an Executive (ED) who becomes a DMD of a bank or any other DMB, his/her cumulative tenure as ED and DMD shall not exceed 10 years,” the apex bank stated in the circular.

The circular which was signed by Chibuzo Efobi, Director, Financial Policy and Regulation Department.

“Non-Executive Directors (NEDs), with the exception of Independent Non-Executive Directors (INED), shall serve for a maximum period of twelve (12) years in a bank, broken into three terms of four years each.

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“EDs, DMDs and MDs who exit from the Board of a bank either upon or prior to the expiration of his/her maximum tenure, shall serve out a cooling-off period of 1 year before being eligible for appointment as a NED to the Board of Directors.

“NEDs who exit from the Board of a bank either upon or prior to the expiration of his/her maximum tenure of 12 years (3 terms of 4 years each), shall serve out a cooling-off period of 1 year before being eligible for appointment to the Board of Directors of any other DMB.

“The cumulative tenure limit of EDs/DMDs, MDs and NEDs across the banking industry is 20 years.”

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A source in the banking sector said this move will force persons at ED, DMD, and MD levels to leave early so that younger bankers can aspire to be at these positions instead of migrating to Canada, Europe, or America.