Absa falls in line with Barclays structure
Absa Group, the South African bank majority owned by British lender Barclays, said it would merge its business and retail banking units and has also created a small team of Barclays and Absa executives to lead its expansion across the continent.
The merger of the retail and business units follows a similar move by Barclays this year, when it reshuffled its own structure.
The unified platform of retail and business banking could help Absa cross-sell more products, said Patrice Rassou, head of equities at Sanlam Investment Management.
“I do think there is potential to better service [customers] by having a unified management team. I see more upside than downside,” he said.
“The Africa board announcement is interesting. The way I read that, Barclays are relying increasingly on Absa to drive the African strategy.”
Absa in April announced a strategy to work more closely with Barclays in sub-Saharan countries outside South Africa.
The British lender has operations in nine African countries outside South Africa and is moving its headquarters for the continent back to Johannesburg from Dubai after buying a 56.4% stake in Absa in 2005.
South Africa’s largest retail lender, like its rivals, wants to expand into the continent’s other fast-growing markets and Absa’s chief executive Maria Ramos told Reuters in March the bank might consider a return to oil-rich Angola.
Absa’s retail unit posted a 75% jump in headline earnings in the six months to end-June, helped by sharply lower impairments, or bad-debt charges, but warned a repeat performance in the second half was unlikely.
Absa said the new merged retail and business units would be led by Bobby Malabie, the former head of business banking.
Gavin Opperman, who previously led the retail unit, will leave the bank in November.
Absa shares are up 0.2% at R135.01 at 14.10pm, and down 3.5% so far this year.—Reuters.