Business

African Bank chief exec quits

Renee Bonorchis

Head of the country's largest unsecured lender, Leon Kirkinis, has stepped down with immediate effect as the bank plans a capital increase.

African Bank expects to post a record full-year loss of as much as R7.6-billion and will talk to investors about a potential R8.5-billion capital increase. (Oupa Nkosi, M&G)

African Bank Investments Ltd, South Africa’s largest provider of unsecured loans, said founder and chief executive Leon Kirkinis resigned as it plans to increase capital for the second time in less than a year.

Kirkinis stepped down with immediate effect after 23 years with the Johannesburg-based bank, Abil, as it’s known, said on Wednesday in a statement. Nithia Nalliah, chief financial officer, will take over as acting chief executive, the bank said.

The lender expects to post a record full-year loss of as much as R7.6-billion and will talk to investors about a potential R8.5-billion capital increase. That follows a R5.5-billion stock sale in December.

Abil has about R1-billion of debt maturing in September and almost R10-billion next year. Moody’s Investors Service cut the lender’s foreign rating to Ba1 in May, one step below investment grade.

Abil plans to separate its banking activities from its unprofitable furniture retail unit, Ellerine, it said. Abil bought the company in 2008 for R9.2-billion.– Bloomberg

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