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Ovia, Elumelu May Return to Zenith, UBA This Year

By on May 27, 2013
Tony Elumelu

Tony Elumelu

There are strong indications that the former Managing Director/Chief Executive Officer (MD/CEO) of Zenith Bank Plc, Mr. Jim Ovia, and his erstwhile counterpart at the United Bank for Africa (UBA) Plc, Mr. Tony Elumelu will return to their respective financial institutions as either chairmen or non-executive directors by the second half of this year or early next year.

The Central Bank of Nigeria’s (CBN) rule on tenure limit for bank CEOs stipulates that the former bank chiefs can only hold board positions in any bank or its subsidiaries three years after their exit expires.

Elumelu and Ovia retired from their respective banks on July 31, 2010.
For both men to make a re-entry to boards of their banks, THISDAY gathered that the directors of UBA and Zenith Bank would have to convene extraordinary general meetings to ratify their anticipated appointment as directors of the banks’ boards.

In 2010, the central bank had enforced a guideline that stipulates a 10-year limit for banks’ chief executive officers. The CBN had at the time explained that the move was taken in order to enhance corporate governance in banks.

By the regulation, no managing director is allowed to serve for more than two terms of five years each. Four former banks’ MDs/CEOs – Elumelu, Ovia, Mr. Akinsola Akinfemiwa of Skye Bank as well as Alhaji Falalu Bello of Unity Bank, were affected in 2010 by the term-limit rule.

Presently, while Akinfemiwa is the chairman of Heritage Bank Limited, Bello is also the chairman of Mainstreet Bank Limited.
However, when contacted on the issue, Elumelu denied that he was contemplating a return to UBA this year.
He said: “It has not really crossed my mind. My intention is to continue to support the bank from outside as there is no urgency to return to UBA.”

A source close to Ovia also said the former Zenith Bank CEO had not made up his mind as to whether he would be returning to the board of the bank this year.
He said: “Ovia has not decided on the issue. It is something he would have to think through very carefully as he is presently preoccupied with so many other things that are keeping him busy.

“Besides, the bank has been running very smoothly in his absence and is doing very well, so there may be no urgency for now.
“His return to Zenith Bank this year may or may not happen as speculated. But he is keeping his options open for now.”

Following his retirement from Zenith Bank, Ovia who is the founder of the bank is also the founder of Visafone Communications Limited. He is the chairman of the Nigerian Software Development Initiative (NSDI) and also chairman, National Information Technology Advisory Council (NITAC).

He is also preoccupied with the construction of the upscale 150-room Marriot Hotel, which is scheduled for completion in 2014.

Elumelu, on the other hand, founded Heirs Holdings, which invests in the financial services, energy, real estate and hospitality, agribusiness and healthcare sectors.
He is also the founder of the Tony Elumelu Foundation, an organisation dedicated to the promotion of excellence in business leadership and entrepreneurship.

Some financial market experts that spoke with THISDAY on the issue said the possible return of the two former bank chiefs would be a positive development for the market.

MD/CEO, Financial Derivatives Company Limited, Mr. Bismarck Rewane, said: “If they return to their banks that will be a great idea. I have never subscribed to the fact that the owner of a business should be separated from the business.

“They should be left to be part of the business. As long as there is corporate governance, I strongly believe that it will be a welcome development. They can return as chairmen as long as the rules are adhered to.”

Also, a financial market analyst, who pleaded to remain anonymous, said: “Once the CBN rule of three years expires by July 31, I don’t think anything is wrong with them returning to the banks as chairmen. Their experience will definitely be needed in the banks.”


( This Day)