Absa paid former CEO Daniel Mminele R30.5m to leave

Absa Group CEO Daniel Mminele – who held the position for only 15 months – was paid a total amount of R30.47 million to “leave mutually”.

He left the group on 30 April 2021 – with finance director Jason Quinn stepping into the interim CEO role from May 1.

ABSA CEO’s controversial exit

R30.5 million for 15 months

The board agreed a “speedy resolution” was in the best interest.

Mminele’s termination payment, therefore, included “good leaver treatment on unvested short-term incentive deferrals and unvested long-term incentives”.

As per Absa’s integrated 2021 report published on Wednesday, only three-and-a-half months of his 15-month tenure fell under the new financial year.

MoneyWeb reports: “More than half of the R30.5 million was in the form of a so-called ‘ex-gratia’ [‘by favour’] payment of R16.5 million following the termination”.

Prior to joining Absa in January 2020, Mminele served as Deputy Governor of the South African Reserve Bank (SARB) since July 2009.

Breakdown of Mminele’s payout

Absa also published a breakdown of the mutual separation negotiation terms, which includes R5 million in lieu of this 2020 short-term incentive.

The payment had been “fully deferred into Absa Group Shares based on a Remuneration Committee decision which considered PRA guidance on Covid-19.

The terms also include a R3.25 million payment of his long-term incentive award (the face value of which was R15 million), and an ex-gratia payment of R16.5 million.

On top of that, Mminele also received contractual payments, including “R4.5 million in lieu of six months contractual notice, [and] a payment of R750,000 in lieu of accumulated leave”.

Furthermore, Absa Group contributed towards Mminele’s legal costs, and an amount of R466,000 was paid directly to him.

“Mminele was paid R13.66 million for the period January 15 to December 31, with the bulk coming from his total fixed remuneration of R8.66 million.

“He received a further R5 million in deferred share awards. This figure excluded the R15 million face value of his long-term incentive award.”

Where is Mminele now?

In February this year, President Cyril Ramaphosa appointed Mminele as head of the newly established Presidential Climate Finance Task Team.

In this role, Mminele will “lead South Africa’s efforts to mobilise finance for a just transition” to a low carbon economy and a climate-resilient society.

The Presidential Climate Finance Task Team, led by Mminele, will engage with partner countries, coordinate relevant government departments and development finance institutions, and oversee the development of relevant financing mechanisms, among other tasks.