Hardly two years before the deadline, Barclays Africa Group Limited has confirmed its intention to change names to Absa Group Limited subject to regulatory and shareholders’ approvals. The target date is May 2018.
The imminent change of names follows a groundbreaking transaction in 2017 that the bank’s majority shareholder, Barclays PLC, selling downs its investment. Barclays PLC stake in Barclays Africa Group Limited (BAGL) has been reduced to 14.9 percent
Sunday Standard has been informed that the lender, which has operations in 12 African countries including Botswana was given up to June 2020 to use the name Barclays Africa Group Limited by its former parent company Barclays PLC of Britain.
It is said that a transitional trade mark license agreement, entered into between Barclays Africa Group and Barclays PLC as part of the separation arrangement, inter alia, provided that the Barclays brand may only be used in the rest of Africa up to 6 June 2020, subject to an additional two-year run off period in respect of debit and credit cards.
At the same time, Barclays PLC is said to have insisted that South Africa, the term “Member of Barclays” must be removed by 6 June 2018, subject to an additional two-year run off period in respect of debit and credit cards.
Meanwhile its latest financial result released on Thursday, the bank says it achieved 4 percent increase in headline earnings while its dividend grew by the same margin to 1,070 cents per share in 2017.
Barclays Africa said its normalised revenue grew one percent to P58 billion and operating expenses rose four percent to P33 billion.
However impairments declined to 20 percent from a high base in 2016 while the cost to income ratio rose to 56.8 percent from 55.2 percent. Return on equity decreased to 16.4 percent from 16.6 percent.
Barclays Africa assumed it would continue to have solid balance sheet assets of 1.2 trillion South Africa Rand and a strong capital and liquidity levels.
The company said it expects growth in loans and deposits to improve in 2018 and forecast stronger loan growth from the rest of Africa as separation from Barclays PLC is progressing well and the parties continue to work together to ensure a seamless separation.
“Our ambition is for a 12 per cent market share of banking revenues across Africa, doubling in size and becoming a banking group in Africa we will be proud of and it’s a bold plan for growth,” Chief Executive Officer, Maria Ramos added.