14 Jun

Barclays Africa to join the Nigerian Stock Exchange as a broker

Barclays Africa plans to join the Nigerian Stock Exchange as a broker in July and is exploring opportunities in three other African countries, in a move to create access for foreign investors looking to tap into markets on the continent.

Garth Klintworth, head of markets for Barclays Africa Group, on Thursday said its subsidiary Absa Nigeria had acquired a securities licence in Nigeria, part of a wider plan to increase it presence in west Africa’s biggest economy.

Nigeria’s stock exchange, the third largest in Africa, has in the last few years said it was reviewing applications from leading global investment banks to join its trading floor to increase foreign investment in one of the world’s least tapped emerging markets.

Read more: Reuters

03 May

Absa Dumps KPMG South Africa in Blow to Auditor’s Survival

Barclays Africa Group Ltd. ditched KPMG LLP South Africa as one of its two auditors, the first major local bank to do so, in another blow to the embattled accounting firm’s hopes of survival in the country.

The decision may pressure other lenders into following suit less than a month after KPMG South Africa lost one of its biggest contracts when the government’s Auditor-General terminated its services.

KPMG has been tainted for work done for the Gupta family, who are being probed for using their friendship with former President Jacob Zuma to win state contracts and influence cabinets appointments, which they deny.

“It’s not the first time a company has dropped them and I suspect it won’t the last time,” said Wayne McCurrie, a money manager at Ashburton Investments Management Co.

“There’s going to be some job losses because KPMG has lost so many clients and they are probably going to lose more. They aren’t getting new clients.”

Johannesburg-based KPMG — which audits four of South Africa’s six biggest lenders, including Barclays Africa — last year lost publicly traded clients including clothing retailer The Foschini Group Ltd., financial services firm Sasfin Holdings Ltd. and consumer-goods distributor AVI Ltd. KPMG South Africa employs 3,400, according to the Johannesburg-based Business Times newspaper.

Barclays Africa’s board “is no longer able to support the reappointment of KPMG,” the lender, which is changing its name to Absa Group Ltd., said in a statement on Thursday.

The contract will cease once all regulatory steps associated with the 2017 audit have been completed by the end of this month, it said, adding KPMG Inc. and KPMG International had supported the local firm’s work.

During the past nine months, KPMG South Africa has issued a public apology for work done for the Gupta family, withdrawn the findings of a report about the country’s tax authority, and interrogated staff who signed off on VBS Mutual Bank’s accounts before it failed.

To read the full article, click here. 

01 Mar

Barclays Africa Returns to Absa Roots as Lender Revamps Strategy

Barclays Africa Group Ltd. is going back to its roots.

The Johannesburg-based bank plans to revert back to the Absa Group Ltd. name, as it was known before Barclays Plc took control of the company in 2005.

With the British bank’s stake now reduced to 14.9 percent, Barclays Africa is also embarking on a plan to double in size and capture at least 12 percent of banking revenues across the continent.

“We will stretch ourselves to develop the platform for double-digit growth and build momentum to accelerate delivery,” Chief Executive Officer Maria Ramos said on a conference call on Thursday. “

This is a critical period in which we will need to complete our separation from Plc, build and scale new capabilities, and rebuild our organizational and cultural foundations to capture growth.”

The lender, which has operations in 12 African countries, is forging its own path after Barclays Chief Executive Officer Jes Staley opted to reduce the British bank’s presence on the continent in favor of a trimmed-down investment bank focused on London and New York.

With the split on track, Ramos, 59, said she will consider appropriate acquisitions to support the company’s growth plan, explore strategic partnerships and new markets, and use technology so the lender’s operations become fully digitized.

While Barclays Africa hasn’t set timelines for reaching the goals, it will seek to support the new strategy by:

  • Creating a consumer-finance business across Africa to fill a “rapidly growing need,” Ramos said. “We’re going to target this opportunity with our core middle and affluent customers and fully expect to grow our base here.”
  • Building a payments hub. “Payments is a highly profitable area and is growing at 8 percent annually. Our payments hub needs to be simple and intuitive and work on a single platform across the continent. It also needs to be affordable.”

To read the full article, click here.

28 Jul

Barclays Africa’s H1 profit rises 7 pct despite S. African downturn

JOHANNESBURG – South Africa’s Barclays Africa Group said on Friday its half-year profit rose 7 percent, driven by solid earnings growth in its local market and the rest of Africa and a strong performance in corporate banking, despite an economic downturn.

The results marked the first time that the company has reported results following Barclays Plc’s sell-down of its majority stake in the African business. Barclays retains just 15 percent of the group.

Barclays Africa Group said normalised diluted headline EPS was 9.177 rand ($0.7055) in the six months ended June compared with 8.567 rand a year earlier.

Headline EPS strips out certain one-off items and is the main profit measure in South Africa.

“We are presenting a set of results that demonstrate the real value of the 2013 acquisition of the Barclays businesses in Africa,” Chief Executive Maria Ramos said in a statement.

“Both geographically, as well as by customer segment, they are proving their worth in yielding a strong performance for the first half, even as our biggest market, South Africa, has suffered the impact of an economic downturn.”

Despite the profit rise, shares were down 1.52 percent to 144.87 rand by 0708 GMT.

In 2013, Britain’s Barclays handed over ownership of all but two of its African subsidiaries to its South African unit in exchange for a 62.3 percent stake in the new combined entity.

Barclays on Friday reported a 1.2 billion pound ($1.57 billion) attributable first half loss after taking a 2.5 billion pound hit from the sale of its Africa business.

Barclays Africa Group’s South Africa banking headline earnings grew 6 percent to 6 billion rand ($462.01 million), while the rest of Africa banking rose 19 percent to 1.5 billion rand.

The group said for the remainder of the year, its main focus will be on its retail and business bank performance, which both under-performed in the first-half, in South Africa and on driving opportunities in its businesses outside of South Africa.

The bank, which launched a court challenge on July 13 to the anti-graft watchdog’s findings that the lender’s South African unit unduly benefitted from an apartheid-era bailout, raised its interim dividend by 3 percent to 475 cents per share.

[Read More: Reuters Africa]

15 Jun

Barclays to surrender control of Africa unit with £1.6bn sale

Barclays has been given regulatory approval for the sale of its remaining stake in its Barclays Africa Group, according to a unit of the business.

South Africa‘s finance minister has approved the deal, ABSA Bank said, and this will allow Barclays to begin selling its remaining 50% stake in Barclays Africa Group (BAGL).

ABSA Bank, based in Johannesburg, is the main business inside Barclays Africa Group.

Barclays Bank Egypt and Barclays Bank of Zimbabwe, which sit outside Barclays Africa Group, will also be sold.

Barclays chief executive Jes Staley said: “Regulatory approval for the separation of Barclays and Barclays Africa is an important step forward and allows us to move closer to our goal of reducing our shareholding in Barclays Africa to the point where we can achieve regulatory deconsolidation.

“It represents a key milestone in the execution of our strategy and the restructuring of Barclays.”

Barclays shares had risen as much as 2.5% in London on Wednesday, after Sky News reported Barclays was drawing up plans to reduce its shareholding in Barclays Africa Group Limited.

The bank has confirmed its target long-term shareholding in BAGL is around 15%.

A large minority chunk of the shares on offer – around 7% – will be acquired by South Africa’s Public Investment Corporation, the African continent’s biggest pension fund manager, according to insiders.

It is understood the share sale is being handled by investment bankers at Barclays, Citi and Deutsche Bank.

If successfully completed, the sale will go some distance towards Barclays’ eventual objective of reducing its stake in BAGL to below 20%, which will allow the London-based bank to deconsolidate the African business from its balance sheet.

Read more: Barclays to surrender control of Africa unit with £1.6bn sale