While costs will improve by the end of the year, expenses are still likely to grow faster than income, the Johannesburg-based bank said in a statement on Monday. Loan and deposit growth will improve, with its rest-of-Africa business outperforming its home market, as will its credit-loss ratio, while the company's net interest margin "is likely to decline slightly this year," the company said.
Absa, which last month rebranded from Barclays Africa Group Ltd. after its former parent reduced its controlling stake, is focusing on winning back market share in South Africa and doubling its share of revenue from its 12 other operations on the continent. The lender reported first-half adjusted earnings per share that rose 3 percent to R9.50.
Absa media statement
Absa Group Limited today reported good progress in positioning to deliver on the new corporate strategy it launched in March 2018. The group, previously known as Barclays Africa Group, reiterated its goal to double its share of banking revenues in Africa to 12%.
"An important milestone in positioning for delivery against our strategy was achieving full regulatory de-consolidation, which means that UK regulators no longer regard Absa and Barclays PLC as a single entity," said Maria Ramos, Absa Group Chief Executive. "In practical terms, it means that we no longer operate under any policy frameworks set by Barclays PLC. For example we are now free to set our own risk appetite."