A NEW CEO was on Tuesday appointed to the “good” part of African Bank in the latest step in its curatorship.

Former Wesbank CEO Brian Riley will lead the entity which has the good loans of African Bank and which will absorb Stangen, the insurance arm of the failed African Bank Investments Limited.

Mr Riley’s hiring also gives the “good” bank an opportunity to grow in vehicle asset financing although this type of lending is expected to be done on an unsecured basis in the short term.

In the past African Bank owned the commercial vehicle asset finance division, which is now known as SA Taxi and owned by Transaction Capital.

Mr Riley’s appointment comes as Parliament is expected to approve the Banks Act Amendment Bill today, which curator Tom Winterboer hopes will allow him the flexibility to restructure and make an offer on repayments to creditors.

He hoped to form the good bank by the end of September, Mr Winterboer said yesterday, although a listing on the JSE would probably happen only in about two years.

A strategy that includes secured lending would be considered as an option for the “good” bank but that would be for Mr Riley and his team to formulate, Mr Winterboer said. The feasibility of transactional banking was being investigated.

“There will be a lot of angles to pursue ... We are absolutely lucky to get him (Mr Riley).

“I think he is well suited for what is envisaged for the company,” Mr Winterboer said. “We are looking at what the system costs are (on transactional banking). If there is a business case, it will be considered.”

Although Mr Riley could broaden the scope of the good bank, Mr Winterboer said unsecured lending remained central to African Bank. “I would like to believe there is still a need for unsecured lending from African Bank. I think there is still a strong brand,” he said.

Mr Riley’s appointment comes after banking veteran and former Absa deputy CEO Louis von Zeuner was appointed as chairman earlier in the year.

Patrice Rassou, head of equities at Sanlam Investment Management, said Mr Riley was an experienced banker.

“He has been around for a long while. He has extensive experience including (in) unsecured lending at Wesbank. He definitely has much broader experience in banking .”

Mr Riley retired from Wesbank in 2013 after serving as CEO for seven years.

Before Wesbank he worked in the UK for financial services companies such as Lloyds and Scottish Finance Group, the Provident Financial Group and Clerical Medical and General Assurance Company.

Mr Riley said his challenge would be to “mobilise the bank’s existing resource base into a defined strategy that can sustain the good bank over the short to medium (term) future”.

Adrian Cloete, PSG wealth portfolio manager, said Wesbank had done well under Mr Riley. “If you look at the track record of Wesbank and at his time there, then this is a very strong appointment — and with Von Zeuner as chairman they have made two very good appointments,” he said.


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