The launch of a process to find an adequate replacement for Bank of Valletta CEO Rick Hunkin is part of a “timely and orderly succession,” and not related to any dissatisfaction with his performance, according to the bank's Chairperson
Mr Hunkin, the bank’s first foreign CEO, was engaged in November 2019, with his three-year contract due to expire in November 2022.
The early start for the search for a replacement was described by BOV Chairperson Gordon Cordina as “normal for any company of a similar size and structure”.
Current BOV CEO Rick Hunkin, expected to remain in place until his contract expires in November 2022
He pointed to the constraints presented by an overheated labour market, the stringent requirements put forward by regulators, and the time required for regulatory approval of any nomination, which can take between three and four months.
“Keeping in mind that there should be a handover to ensure continuity, it was only prudent to kick off the process when we did.”
Dr Cordina stated that BOV wants to find the “best possible candidate” to lead the bank in a period beset by challenges, and explained that early planning could also lead to cost savings.
“If you approach a headhunting agency for such a position and give them a short time-frame to find someone, the pool will be limited and the costs will be high. By allowing the process time to take its natural course, we are putting ourselves in the best position to ensure a timely and orderly succession.”
Mr Hunkin’s tenure has not been without controversy. Reports state that the relationship with senior management was tense, and lucrative consultancy contracts handed out to contacts of Mr Hunkin raised eyebrows among shareholders.
Dr Cordina has previously stood by the contracts, saying that the bank ensures that any such consultancies are short-term, have key identifiable objectives, and leave a knowledge transfer effect.
“We want to make sure that such expenditure is not done as a business-as-usual matter, but is intended to allow the bank to complete specific tasks and objectives.”
Asked if these consultancies had a bearing on the decision to start looking for Mr Hunkin’s replacement, Dr Cordina was unequivocal: “Such expenditure is seen by many pairs of eyes, both before and after it is spent. We have oversight by the internal audit procedure, by the audit committee, by the Board, and finally by the regulator.
“I can say that there is no evidence of any wrongdoing, mismanagement, bad governance or otherwise. If there were, we would have already taken the necessary and adequate steps.”
While acknowledging that the bank has made progress over the last two years, Dr Cordina said that a renewal of Mr Hunkin’s contract is “not likely”.