British lender Barclays announced it had shed its remaining 7.4 per cent stake in South African bank Absa today as it dramatically pulls back its presence in Africa.
Bosses at Barclays said this morning the sale would earn Barclays around £538m, representing around a £31m loss on its investment.
The sale followed an announcement from the bank on Wednesday that it was looking to sell its remaining shares in the firm, after offloading a similar sized stake earlier this year for £526m.
The exit marks the final step in Barclays’ plans to withdraw the vast majority of its presence from Africa, after then-boss Jes Staley said in 2016 the firm would shift to focus more of its efforts on the US and Britain.
Staley’s plans spurred the bank to offload its 62 per cent stake in Barclays Africa, which was a merger of Absa and Barclay’s African operations and counted around 45,000 employees – a third of all Barclays staff prior to the exit. Absa controls banks in 10 African countries, including Ghana, Kenya, Botswana and Tanzania, serving millions of customers.
The shift in focus toward its core markets also involved proposals to shutter some of the lender’s smaller operations in Asia, Brazil, Europe and Russia.
Barclays said the proceeds of the sale of its remaining shares in Absa will be channelled into general corporate purposes.
Barclays was South Africa’s biggest lender until 1986 when it quit the country in the midst of apartheid, before restarting its operations in the country with its corporate and investment banking division in 1995. It restarted its retail banking operation in the country in 2005.
The British lender’s only presence in Africa will now be reduced to a representative office in Johannesburg which is able to support its investment, private and corporate banking clients. In 2020, the private bank was granted a licence in South Africa to offer offshore services to clients located in South Africa.