BARCLAYS Africa Group on Monday said it would invest R1.2bn over the next three years transforming its branch network and automated teller machines (ATMs) and digitising channels.
Barclays Africa Group, whose branches are branded Absa in South Africa, said it had spent some time acquiring skills from banks such as HSBC, Standard Bank and Nedbank, and had done an analysis of the challenges facing the retail and business banking division.
This formed part of a 12-point plan aimed at strengthening Barclays Africa Group’s South African retail and business banking divisions. In the six months to end-June, retail and business banking in South Africa made up more than half the headline earnings posted by the group.
Of the R4.6bn posted by Barclays Africa Group (previously listed as Absa on the JSE), about R2.9bn came from the retail and business banking division.
"We have committed R1.2bn to start transforming our branch network," the head of the group’s retail and business banking division Craig Bond said in a media briefing on Monday.
Barclays Africa Group’s retail bank has 9.2-million customers in South Africa, 864 branches and 9,162 ATMs. Mr Bond, who used to work for Standard Bank in Hong Kong, said 70% of the bank’s branch leases would expire in the next 22 months, a situation that will see the bank close some of the branches and reopen in strategic areas in order to capture its market better.
Speaking candidly about the bank’s woes and the state of the bank that he found, Mr Bond conceded that Barclays Africa Group in South Africa had lost thousands of clients to Capitec, First National Bank (FNB) and Standard Bank.
"When I got here in January it felt like an organisation that had lost its confidence," he said.
Due to the bank’s strategy to pull back on personal loans, some customers had moved their transaction accounts to get a personal loan elsewhere, Mr Bond said.
"We definitely lost some middle-market clients to FNB and business banking to Standard Bank," Mr Bond said.
"We are very clear in our mind as we build the African franchise we have to build the business bank." He added that the bank was working on launching South Africa’s cheapest bank account with a retailer.
One of the innovations in business banking has been the Absa Pebble, which is a point-of-sale card accepting device that is plugged into a smart phone.
He said this year was all about fixing the bank’s lending book and this was now clean. "We spent a huge amount of time getting credit skills," Mr Bond said.
One of the Johannesburg-based analysts said Mr Bond brought in a breath of fresh air, which was good. However, it was important to note that Barclays Africa Group in South Africa was not operating in a vacuum.
"Everybody is also trying to ramp up their businesses. Capitec is not sitting on its laurels," an analyst said.
Mr Bond said the bank was increasingly digitising and leveraging off Barclays technology.
He said new ATMs had been rolled out in South Africa. These machines had the ability to print electronically stamped statements that were verifiable.
Mr Bond said over the past three to four years, Barclays Africa Group did a lot of sponsoring but not much advertising.
He said the bank would remain a sponsor to rugby, soccer and the Cape Epic, a mountain bike race in the Western Cape.
Outside South Africa, Barclays Africa Group wants to expand its credit card to five areas including Ghana and Uganda, said the chief of staff at Mr Bonds office, Paul Nel, on Monday.
