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The belated presidential appointment at Wegagen Bank
SC is to arrive finally, as the Board of Directors
of the Bank chose a veteran banker, Hadgu Hailu,
former vice president and human resource head at the
state-owned Commercial Bank of Ethiopia (CBE) as its
new president. The National Bank of Ethiopia (NBE),
regulatory body of the country's financial
institutions, has accepted the appointment of the
nominee.
Wegagen has been operating for the past year without
a renewed business license because their acting
president, Araya Gebreegziabher, was not accepted by
NBE.
"After appointing the new president, the Bank now is
able to renew its license," a source at NBE told
Fortune.
Though the Board of Directors of Wegagen had earlier
appointed Araya in September 2006, NBE was not
willing to accept his appointment, as he does not
meet the minimum requirement set by the directive of
the central bank to be a leader of a commercial
bank.
A directive issued by NBE in June 2006 stipulates
that a bank president should at least have a first
degree and 10 years of banking experience in a
managerial capacity.
Ever since NBE rejected the appointment of Araya
because of his only eight years experience in the
banking industry, the Wegagen Board had a hard time
in finding the right person for the post.
"The only option we had was to offer an attractive
salary. But still it was a big challenge to find
one," a Board member of Wegagen told Fortune.
The negotiation with Hadgu was started with
Wondwossen Kebede, the former Board chairman, and
finalised three weeks ago by Sibhat Nega, the new
Board chairman of Wegagen and top brass of the
governing Ethiopian Peoples Revolutionary Democratic
Front (EPRDF).
After the Sibhat-led Board finalised the negotiation
with Hadgu, it requested NBE's acceptance three
weeks ago. NBE finally informed Wegagen of its
acceptance last week.
Hadgu, 48, has been working for CBE for more than 20
years from loan officer to vice president positions.
Sources at CBE told Fortune that Hadgu has
been working only at CBE since he left higher
education.
Hadgu was a control head of CBE when management
members of the Bank, led by Tilahun Abay, were
accused of corruption and jailed for the last four
years. The control head used to be accountable
directly to CBE's Board.
After the members were detained, Hadgu was a vice
president of the Human Resource Division in the
management led by the late Gezahegn Yilma. After the
CBE Board dismissed this management in February
2006, Hadgu had no formal position but received a
monthly salary.
One of the dismissed management vice presidents with
Hadgu at the time, Tsegaye Tetemke, is the president
of the recently launched Lion International Bank SC,
together with Woldegabriel Tewelde and Woldegabriel
Wodajo. The other member, Fasika Kebede, left CBE
and became a member of the Ethiopian Red Cross
Society. Hadgu was the only vice president who
remained at CBE.
"He is such a suspicious person. He does not trust
anybody around him and he thinks every single job
that is done has an agenda," his long time
colleagues told Fortune. "He works his job
effectively and tirelessly."
Hadgu was unavailable for comment.
The Board of Wegagen is now expected to sign the
agreement with Hadgu this week. "Very soon he will
receive a letter of accreditation as the President
of the Bank," a Board member told Fortune.
Hadgu will be the third President of Wegagen.
"Araya managed the Bank effectively. In his
leadership, the Bank has earned more than 100
million Br net profit. So he deserves recognition,"
a banker told Fortune.
Becoming operational in June 1997, with a capital of
30 million Br and about 20 shareholders, Wegagen
grew to encompass 462 shareholders by December 2006.
The Bank has a paid up capital of 265 million Br.
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