Absa has cut short the gardening leave for its former CEO Abdi Mohamed, allowing rival lender I and M Bank to hire him as their head earlier than agreed.
Mr Mohamed was expected to take over at I and M Bank in December following terms attached to his exit that barred him from joining a rival bank within six months.
But I and M Bank announced that his tenure as CEO started on October 5 after executive changes at ABSA triggered the termination of the gardening leave.
Garden leave is a period when a departing employee stays on the company payroll and receives full pay and benefits during their notice period, but is instructed to stay away from work and forbidden from starting a new job.
When on garden leave, the former workers lose access to office buildings, company computers, emails, and colleagues.
But they must stay available during normal work hours if the old employer needs a quick question answered or a handover finished.
Absa Bank’s decision to promote Yusuf Omari as the substantive chief executive after holding the position in an interim capacity for two months triggered the end of Mr Mohamed’s gardening leave.
‘We fast-tracked the appointment of our CEO so we didn’t need to keep him any longer, and I and M had requested a fast-track also because they really wanted him taking over – so it was more a gentleman’s agreement,’ said a source at Absa Bank who sought anonymity.
‘We didn’t need consult him as per the requirements of gardening leave, so we terminated early,’ he added.
His gardening leave was terminated at the end of September. He has been enjoying full benefits as a chief executive, and Absa faced the financial load and an awkward arrangement of having a substantive CEO while retaining its former boss.
I and M Bank’s poaching of the CEO from its larger rival Absa Bank Kenya underscored the ambitions of the smaller lender that has been expanding aggressively in recent years.
The sudden move by Mr Mohamed to I and M Bank-the Kenyan banking subsidiary of I and M Group-marked a rare spectacle in the corporate world where CEO transitions are usually carefully planned to ensure smooth handovers.
The departure was also curious given that I and M Bank is smaller compared to Absa in terms of earnings and market value.
I and M Group will stretch its payroll if Mr Mohamed is to retain the same level of compensation he was enjoying at Absa.
His benefits at Absa totalled Sh120 million last year, dwarfing the Sh79.2 million that I and M Group paid its regional chief executive, Kihara Maina, who will now be his boss.
I and M Group has regional operations in Kenya, Tanzania, Uganda, Rwanda and Mauritius, which are overseen by Mr Maina. Mr Mohamed will head the Kenyan operations.
Mr Mohamed had worked with Absa, formerly Barclays Bank, for 32 years, rising to lead its Tanzanian operations before moving to helm the Kenya business.
‘The board of I and M Group Plc is pleased to inform the public that following receipt of all regulatory approvals, Mr Abdi Mohamed has been appointed as the chief executive officer of I and M Bank Limited with effect from 5 October 2026,’ said I and M Group in a public announcement.
The group has been vocal about its intentions to play more in the retail market with investment in a more robust IT system to support large numbers.
In the first three months of the year, Absa Bank reported a 13.8 percent drop in net profit to Sh5.3 billion, while I and M Bank Kenya reported a net income growth of 8.4 percent to Sh3.42 billion.
Absa has an asset base of Sh571 billion, constituting a loan book of Sh303 billion, while I and M Kenya has Sh550 billion in assets and loans of Sh250 billion. Customer savings with the two banks are almost at par, with Absa having Sh396 billion in deposits while I and M has Sh396 billion.