Neatly dressed in a dark blue suit and gold tie, Standard Chartered Chief Executive Officer has a penchant for fashion. As he gingerly sips an orange juice at Falcon Crescent, Moatlhodi Lekaukau narrates how he landed the lucrative post at the oldest bank in the country.
“While in South Africa I received a call from one of the executives at head office saying they would like me to work for the bank. I did apply for the job,” recalls Lekaukua, a chartered accountant. That was in 2011.
As head of mergers and acquisitions at Delloite South Africa, Lekaukau began the difficult task of negotiating his exit from Delloite to make history as the first Motswana to head the listed and oldest commercial bank in Botswana.
“We had conversations with senior officials that lasted more than five months before I finally signed a contract,” he vividly remembers. About a year in to his new post, life has not been a bed of roses as he is forced to build a strong team to ensure the bank still retains its leading position in the highly competitive commercial banking retail market. Most importantly, he had to quickly transform into a banker, away from the mergers and acquisition industry. “The first thing was to ensure we have the right staff and infrastructure,” he said. In the months he was at the bank, he sent some of the staff to gain experience at some of the sister banking operations outside the country.
He was well aware of stereotypes associated with his new role as Standard Chartered is sometimes wrongfully considered conservative in its approach to banking. While traditional adversaries such as First National Bank of Botswana (FNBB) and Barclays Bank of Botswana have been busy expanding network and introducing new products, the bank has been seen to be lagging behind. “We are not conservative as some people think,” he points out and confesses: “In fact when I joined the bank I had that same perception but that has since changed.”
As a deposit taking institutions, Lakaukau and his team is aware of the sensitivities surrounding safeguarding clients’ wealth and the banks’ readiness to return the wealth to clients when the need arise.That involves a careful consideration before any thebe is withdrawn from the banks’ coffers. This sensitivity and care has been a winning formula for the bank. “In the past year alone we opened two branches and this year we plan to open one more. We have auto loans and SMME products coming out soon,” the University of Cape Town graduate revealed.
He is also aware of the fierce competition from rival banks in this segment. Auto loans, which will hit the market in the coming weeks, will meet fierce competition from Stanbic Botswana and FNBB that already have dedicated units for the highly competitive vehicle financing sub-sector. Lekaukau said with proper marketing and improved customers’ relations, he cannot see reasons why they will not compete.
The bank, which is a unit of Standard Chartered plc is currently among the top three banks in the country. The bank has a strong team, which can rise to occasions at any day to seize opportunities as they rise.Diamond Trading Company (DTC) aggregation is also seen as a growth potential for Standard Chartered bank. “DTC relocation presents a good opportunity for us. We already have a relationship with them,” explained the soft-spoken Chief Executive.
His bank has already hit the ground running. Last year, the bank won a highly contested tender to service more than 50 DTC employees with corporate cards for an unspecified period of time. The company currently has accounts with a majority of sighholders that are signed with DTC Botswana. “We are a dominant player in that industry,” he said with confidence. Two India banks, Bank of India and State Bank of India have been licensed to provide commercial banking services in the country.
Lakaukau seems to also cherish competition and welcomes the two Asian banks. “We hope they will bring in more energy to the industry,” said the 38 year-old banker. Standard Chartered has a market share of about 20 percent in the local banking industry. Standard Chartered is in a closed period and will soon release their full year results to December 2012. Wary of offending his regulators, Lekaukau avoids discussing the forthcoming results. “Just wait and see,” he says confidently.
If history is a guide, he has a reason to remain upbeat. Half-year results ended June 2012 were impressive. Profits rose to P176.5 million marking a 44 percent increase from the same period in 2011. Wholesale banking and consumer banking proved to be the major contributors to the results. Over the years, the bank, like many others have depended mostly on interest income for profits. However, the changing economic landscape and declining disposable income for consumers have forced banks to change strategy.
“Our book is the strongest in the market,” he boasted. Going forward, the bank will ensure they maximise profits from their corporate banking division that target large companies. In the previous year, the bank made a landmark deal when it loaned Far Property P400 million, a company associated with Choppies.
“We will continue to look for more deals,” promised Lekaukau. SMME unit that is headed by Motlalepula Mpho is also expected to contribute to growth in the medium term. This week, Standard Chartered plc reported full year results to December 2012 in which income grew by a staggering 8 percent to $19 billion (P146 billion).
Lekaukau’s bright eyes begin to shine on the mention of his parent company. “We are among the top 20 globally,” he said as he points into a lifeless paper which details top 20 banks in the world. Standard Chartered plc is ranked number 12 according to a research conducted by Bloomberg last year. Africa contributes 12 percent to the group profit, of which Botswana is part. Perhaps the plc results provide a perfect ‘mirror’ into what shareholders must expect from the bank when they announce results in the coming weeks.
Basel II, a regulatory framework that among others, is aimed at ensuring that banks have sound balance sheets which will be introduced next year. “We don’t have any problem with it. It is healthy for the industry. We will use expertise from our global network to help us prepare better,” he added. Concerning the future, Lekaukau reveals that the market should brace for more from his bank.
“Wait and see, we will be a leader in the digital market,” he repeats, referring to among others online banking. FNBB has been the bellwether when it comes to technology. As we wrap up the interview, I ask him if he is interested in the vacant Barclays CEO post. He laughed loudly before answering. “I am here for good,” imitating the company’s slogan.