Barclays Bank Plc is set to pull out of Zimbabwe as part of an Africa-wide exit to focus on its core British and American markets, the Financial Times has reported, citing sources familiar with the matter.
Barclays Plc’s new chief executive Jes Staley, who was appointed three months ago, has led a review of the banking group’s Africa operations and reached a decision to divest from the continent with many sub-Saharan economies in turmoil.
Staley is expected to lay down the plans and the group’s shift to focus on high performing units at Barclays Plc’s 2015 results presentation on Tuesday.
Barclays’s assets in Africa include a 62.3 percent in Barclays Africa (formerly ABSA), which has operations in 11 African countries as well as direct subsidiaries in Zimbabwe and Egypt. A bid by Barclays Plc to sell the Zimbabwean and Egyptian banks to Barclays Africa failed last year after the parties could not agree on price.
The Zimbabwean and Egyptian banks are now most likely to be sold as part of the new strategy, the FT reported on Friday.
Barclays’ exit from Zimbabwe, where it has operated since 1912, making it the second oldest bank in the country after fellow British bank Standard Chartered.
Barclays Plc owns 68 percent of the Zimbabwe Stock Exchange-listed Barclays Bank Zimbabwe, which employs 713 workers and operates from 28 branches nationwide, according to Reserve Bank of Zimbabwe data.
Barclays Zimbabwe’s assets stood at $311 million at half-year 2015, while net profit was $1.3 million in the period.
It remains to be seen whether Barclays Africa, which on Monday issued a statement reaffirming its commitment to Africa, will revive plans to acquire the Zimbabwean and Egyptian banks after Barclays Plc’s exit. Talks between Barclays Africa and Barclays plc over the sale of the two assets broke down in December last year.
The two operations were excluded from a 2013 deal that saw Barclays Africa, formerly ABSA, acquire eight African operations from its parent company because of political uncertainty, although it already manages their operations.
Barclays Africa chief executive Maria Ramos said at the time that Egyptian banks and insurers in particular were highly prized and expensive.
Barclays’ exit from Africa comes at a time when its former chief executive Bob Diamond has made a big play for the continent, leading his Atlas Mara through a string of acquisitions of African banking assets.
BRIEF HISTORY:
Barclays Bank Plc, which owns 68 percent of Barclays Bank Zimbabwe Limited, is on Tuesday expected to announce its exit from Africa as it seeks to focus on the British and American markets.
This move could see Barclays ending its 104 year history in Zimbabwe, where it has run the second oldest bank after fellow British bank Standard Chartered.
Below is a pen-pix of Barclays’ Zimbabwe operation:
Type of bank: Commercial Bank
Date of establishment: 1912
1912; Opened first branch after Bank of Africa was acquired by National bank of South Africa and effectively became Barclays Bank controlled from South Africa.
1928; as the business grew, the first Barclays Committee was established, responsible for local controls based in Bulawayo. 10 branches were opened by that time.
1956; Barclays was the first bank to introduce computers making banking service delivery increasingly efficient. During that time Barclays was implementing a comprehensive training programme running between 1951-1958.
1960; Barclays was the first to introduce the first night safe and safe deposit facility featured on its newly established 8-storey head office in Harare built out of diamante sandstone on a black granite plinth and designed by Francis Lorne.
1987; the first country branch was established in Gokwe officially opened by the then Deputy Prime Minister who praised Barclays for heeding the government’s call to bring banking to rural people.
1991; Barclays was the first financial institution to offer 30% of its shares to the public in an effort to encourage Zimbabwe to become first time investors. The issue was oversubscribed five-fold and caused a record rise in stock market prices.
1993; Barclays was one of the only two banks to have installed ATMs to improve service delivery and by the end of that year had 50 ATMs.
2008-2012; Barclays rationalised its support structures and foot print in line with business levels obtaining which resulted in reduction in fulltime employees from a peak of 1,423 in January 2008 to around 700 currently.
Ownership: Barclays Bank of Zimbabwe Limited is a subsidiary of Barclays Bank plc, which is the majority shareholder of the bank. It is locally registered and is a publicly quoted company with the investing public holding 32.04% shares.
Major shareholders in the bank AS AT 30 JUNE 2014 are:
Afcarme Zimbabwe Holding PL 67.68%
Old Mutual Life Assurance LTD 4.50%
STANDARD CHARTERED NOMINEES (PVT) LTD –NNR 3.03%
FED NOMINEES (PVT) LTD 2.42%
Chairman: Mr Anthony Mandiwanza
Chief Executive Officer: Mr. George Guvamatanga
Auditors : KPMG Chartered Accountants
Number of employees: 713
Number of branches : 28
The Source/RBZ