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January 22, 2019

Marambii's Last Stand: Avoid Spin And Say It Like It Is

Reuben Marambii, the former long-serving MD of National Bank died on Thursday morning. For 12 years, Marambii led the 45-yeard old bank that was teetering on the verge of collapse when he took it over. A simple, straight-talking old-school banker, Marambii’s enduring image on TV during those years was of stormy National Bank AGMs when he would be seen gesturing to angry shareholders to calm down amid news that they would not be receiving a dividend for yet another year.

At one of the AGMs I covered, I remember one shareholder angrily shaking the company’s annual report in the air and shouting, “Instead of printing these you should pay us dividends.” Stoic, Marambii would throughout the years give the same response, “By law, we are not allowed to pay dividends until we clear accumulated losses.” Indeed, the bank had a mountain of losses to recover after years of mismanagement and political interference.

By 1998, when the tempestuous NBK shareholders in an Extraordinary General Meeting sacked the entire board of directors and the then Managing Director, the bank had accumulated losses of Sh26billion and was facing ruin. Marambii, a career banker with decades experience in commercial banking at Cooperative Bank and at the Kenya Commercial Bank before moving to the Central Bank of Kenya, was then in charge of bank supervision. He had met severally with NBK’s management in an attempt to stave of the bank’s collapse and so when shareholders decapitated management and asked Treasury to name a new MD, Marambii who had to brief government officials on the bank’s situation was appointed the new MD.

“So, I simply walked from Central Bank to National Bank,” Marambii once told me. The two are banks are a stone throw away from each other. Marambii was a no-frills banker and avoided showbiz and high-profile appearances. In his belief, the principles of banking could be picked from a standard textbook. Thus, when I asked him whether he took his staff for training, he responded: “Serious banking has been around since the 17 th Century.

There is nothing new you can bring to banking.” Indeed, new things like sub-prime mortgages, credit default swaps and derivatives in the US are what brought about the global financial crisis hence the terminology, financial weapons of mass destruction. One of those simple principles Marambii captured in a statement he made to me: “There is nothing like a written-off loan. It simple means we have not yet recovered it but we will.” His dogged pursuit through the courts saw many politically correct individuals of yore who owed the bank money repay them in one form or another. But for his biggest debtor, the government of Kenya, who through various parastatals owed NBK over Sh20billion he had a different approach.

“These are your children,” Marambii told Treasury which had appointed him to his post in the first place. “Either you pay for them, or you allow me to sell them.” And to make good on his threat, Marambii would later show up at the gate of the then defunct Kenya Meat Commission, with auctioneers in tow. Treasury, owning up to the debt, decided to convert it into long-term bonds worth Sh23billion. 11-year after he took over, National Bank cleared its accumulated losses and was back to paying dividends to its long-suffering shareholders. As a journalist, there are a few CEOs/Leaders I’ve met who tended to avoid spin and tell it like it is: the late John Michuki, former Safaricom CEO Michael Joseph, former PS and now Senator John Lonyangapuo, Agriculture PS Romano Kiome, and Reuben Marambii.

Unlike investor briefings by other banks where PR agencies withhold the financial statements until after the event to shield the CEO from penetrating questions, at NBK’s briefings, the financials would be distributed ahead of time and the MD would give journalists and investors time to peruse them before taking the podium. And inasmuch as he was straight talking, he also didn’t suffer fools gladly. When asked by a journalist once, why the press was not being told anything about plans to privatize NBK, Marambii replied, “If you haven’t been told anything, it is because there has been nothing for you to be told.” In 2008, I attended NBK’s 40 th anniversary dinner where the late John Michuki, cabinet minister and founding chairman of the bank and Marambii toasted to the slogan, “Yes, we can!” in solidarity with then US presidential candidate Barack Obama’s rallying call.

The event was attended by Treasury officials, CEOs, Teachers Service Commission bosses, Kenya Revenue Authority officials, MPs and so on. His work done, Marambii retired in 2012 without pomp or grandeur. Recently, I attended National Bank’s rebranding event. Out of the woods, the bank is eager to sprint forward with its new young CEO.

The same cast was present, Treasury officials, CEOS, TSC bosses etc. Conspicuously absent was Reuben Marambii. Last seen when he unsuccessfully contested the governorship of Meru County, Marambii was indisposed it later turns out. His last stand was at Aga Khan Hospital where he passed away on Thursday morning.

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