Headquartered in London, Barclays is a multinational investment bank and financial services company. Its African chapter has officially closed after a century on the continent.
Reverting back Absa Group Ltd., the lender cuts ties with Barclays on Wednesday after the company sold the controlling stake it gained in 2005. Based in Johannesburg, Absa will begin structuring its operations to further sever its relationship with the U.K. firm.
The company’s Chief Executive Officer Maria Ramos, 59, divided Absa into four separate departments. Its first department will deal with retail and business banking, which is the most lucrative. Corporate and investment banking, wealth management, and insurance will be its other divisions.
The company’s renovation comes as an attempt to reclaim South Africa’s market share and retail market. As a result of the company’s rebranding, the number of executives working in retail and business banking was cut in half last month.
“Barclays has been a very big brand in Africa, not in South Africa necessarily, but in the rest of Africa,” said Adrian Cloete, a portfolio manager at PSG Wealth. “That means they’re going to have to spend more on their brand there when they brand back to Absa.”
As the CEO of Barclays, Jes Staley reduced his lender’s stake in Absa down to under 15 percent in an effort to conserve capital and rebuild the company’s investment back.
When Barclays first bought the National Bank of South Africa is 1919, which gave it units across Africa. In 1986, the company left South Africa while it was the largest lender in the nation due to the widespread anti-apartheid protests.
What is the Future of Absa?
Ramos believes that Absa as an independent business will be a great opportunity for the business. Determined to expand its digital footprint and targets, it is looking into building more strategic partnerships within Johannesburg.
For the investments in technology, rebranding and other expenses that arose after the separation, Ramos has negotiated 765 million pounds, or $1 billion USD from Barclays.
According to the CEO, by 2020 the Absa brand will extend to Botswana, Ghana, Kenya Mauritius, Mozambique, Seychelles, Tanzania, Uganda, and Zambia.
Furthermore, Brand Finance has estimated that Asba is currently worth 18.9 billion rand, or $1.4 billion USD, and is the fourth most-valuable brand.
Featured Image via Flickr