CAPE TOWN: Barclays’ new chief executive is planning to announce on Tuesday that the British bank has decided to exit its African operations in a bold move to refocus the bank on its core UK and US markets
After a review of the African business led by Jes Staley, the bank’s board decided last week that in principle it made strategic sense to get out of the continent, according to people familiar with the matter.
The board has delegated authority to a subcommittee to examine the practicalities of how and when to sell Barclays Africa, one of its four main lines of business. By delegating authority it avoided having to disclose the decision immediately.
This means that a sale of the bank’s 62.3 per cent stake in its Johannesburg-listed subsidiary will depend on numerous factors, including market conditions and the response of regulators.
The stake is worth R78bn ($4.83 billion) at current market prices. Investment bankers say there are no obvious strategic buyers for the African business. The value of the stake has fallen in recent months, making the option of steadily selling the stake to institutional investors less attractive. Barclays declined to comment.
Several people who have met Mr Staley recently say he recognises Africa is one of Barclays’ few genuine growth areas, but he believes it is becoming a costly distraction as the South African rand devalues and the country’s economy slows down.
