Barclays to debate Africa stake
London - Barclays’ board will debate the future of its Africa business at meetings starting on Wednesday in London, with options including a sale of the entire stake, according to two people with knowledge of the matter.
The board meeting, led by CEO Jes Staley and Chairman John McFarlane, hasn’t been specifically scheduled to discuss the future of the African business, said the people, who asked not to be identified because the agendas of the meetings are private. Executives will also discuss the bank’s latest plans for separating the UK consumer and investment banking arms under so-called ringfencing rules, they said.
The British lender owns a 62 percent stake in Johannesburg- based Barclays Africa Group, which was built up under former CEO Robert Diamond. Staley, under pressure to focus on the most profitable businesses in the UK and the US, has to decide whether to keep the unit amid concerns over slowing economic growth and a falling South African rand.
Read also: Barclays names new COO
If the board reaches a decision, Staley could give more details on his plans for Africa in a strategic update to be presented alongside the bank’s full-year earnings on March 1, said the people. A Barclays spokesman declined to comment on the contents of the meetings.
In Africa, where Barclays has operated for almost a century, pretax profit slipped 7.7 percent in the third quarter, compared with increases at the credit-card and personal and corporate-banking divisions. The region reported a return on equity of 9.7 percent in the third quarter, below the bank’s target of at least 11 percent.
The bank had 52.2 billion pounds ($75 billion) of assets, or about 14 percent of its total, in the region at the end of the third quarter and employed 44 700 people in Africa and the Middle East at the end of 2014, according to its annual report.
Read also: Banking jobs at risk
UK banks had to submit their “near final” plans for ringfencing to the Bank of England’s Prudential Regulation Authority on January 29, according to a spokesperson. Regulators are seeking to separate riskier investment-banking activities from consumer lending.
-With assistance from John Glover.