Business

Barclays Bank goes Absa Bank

BARCLAYS Africa chief executive officer Maria Ramos

KABANDA CHULU, Lusaka
FOR close to 100 years, Barclays Bank has operated in Zambia to become one of the country’s leading financial institutions in terms of financial strength, product range and service capability.
The bank, which is currently represented by over 70 offices consisting of full branches, sales centres, and agencies throughout the country, will soon start trading as Absa Bank following the successful conclusion of the reduction by Barclays UK plc of its majority shareholding in Barclays Africa Group Limited (BAGL).
The proposed name change is still pending shareholder and regulatory approvals in the respective markets.
As the blue tide, associated with blue and white (Barclays) colours drifts away, here comes a spectra of white and red (Absa) colours, beaming with confidence as it outlines a new strategy for growth, to eventually result in increasing market position from six to 12 percent of African banking revenues.
The genesis of the proposed name change relates back to events of about five years ago when Barclays UK plc decided to scale down its majority stake in BAGL, a development that made African operations to become a stand-alone business hence the need to address its future name and brand.
To make this decision of discarding the Barclays brand, seemed to have been a daunting task, and it must have given the Maria Ramos-led BAGL entity some headache on branding options.
Two options must have been considered either to keep the Barclays brand or as luck would have it, the group settled for Absa. But massive sensitisation is needed to reposition the brand (Absa) as an African brand, instead of a South African one.
According to Wikipedia, the Barclays Africa Group Limited (BAGL), is formerly ABSA Group limited originally Amalgamated Banks of South Africa.
Absa was founded in 1991 through the merger of financial service providers such as United Bank (South Africa), the Allied Bank (South Africa), the Volkskas Bank Group and certain interests of the Sage Group.
Its three-word slogan of ‘today, tomorrow, together’ has helped the bank to battle for dominance in South Africa and this is expected in the Zambian market.
Nevertheless, the proposed name change, as good as it may be, has caused mixed reactions. Some people especially customers are sceptical in Zambia and other African markets.
This is because a few years ago, Barclays Bank down played market speculations about concerns of shutting down some branches, especially in rural areas in African operations.
Later, this development turned out to be true and the bank, indeed closed down branches, sending shivers to customers and some workers got retrenched.
A former customer in Lundazi, who has vowed never to bank with Barclays again, Mwiinga Mwiinga says justification to close rural branches didn’t make sense since it inconvenienced clients.
“This is a rural district, and by then, there were only two banks [with Zanaco Plc] but Barclays decided to dump us claiming the economy is not doing fine.
“How come Finance Bank [now Atlas Mara] which took over most of the Barclays’ rural branches excelled and made them profitable during the bad economic times?” he asked.
During the same period, in the United Kingdom, at a briefing to justify the closure of rural branches, an angry shareholder described the closures as reprehensible because they may lead to the destruction of rural communities and for many old people who depended on the bank.
In response, then Barclays Group chairman Sir Peter Middleton defended the principle of closing branches, saying the bank ‘is now recruiting 4,000 customers a day’ due to its internet banking services.
Nevertheless, Ms Ramos and her team of outstanding advisers are cognisant of this fact: “The need to put across a strong, transparent and clear message that proposed name change will not affect operations and service delivery.”
“Our sustainable growth is to be driven by a transformative culture, and our overriding goal is to become a banking group of which Africa can be proud of.
“The sell down gave us the opportunity to roll out a brand that reflects our identity in Africa and to unite our operations in 10 countries behind one name. We will be Absa, not as you know it but relaunched, represented and with an identity fit for the new and forward looking business we are creating,” Ms Ramos said.
And Barclays Zambia managing director Mizinga Melu assures the bank is not pulling out of the country despite the proposed name change.
Ms Melu said the Barclays UK shareholding has scaled down to 14.9 percent.
“This prompted the intention to rename the brand since Absa is now the majority shareholder but business remains the same and customers should not worry since we shall continue providing the same services, and even improve upon our delivery of products to ensure that clients grow their businesses.
“We are not pulling out of Zambia but just a name change due to changes among shareholders. We are here to stay and we are even building a new headquarters and we are undertaking repositioning of branches and opening new ones,” she said.
It is unavoidable that Barclays Bank embarks on a vibrant campaign of awareness to assure people that the institution which has been in Zambia for 99 years is not shutting down.

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