Absa group, the parent company to Barclays Kenya has posted a 5.4 percent increase in net earnings in the first half of 2019. The results were bolstered by improved SA retail and business banking unit performance.
Absa is Africa’s third largest bank with subsidiaries across 12 African nations.
First-half net income climbed 5.4% to 7.64 billion rands (KSh51.4 billion). ABSA’s domestic retail and business bank adjusted earnings rose 4% to 4.85 billion rand while it’s South African corporate and investment bank’s profits dipped 10% to 1.55 billion rand due to high costs and low revenues.
Absa Group’s largest business unit, Retail-banking business provided more personal loans and credit cards as fees and commissions boosted revenues. Retail and Business banking showed faster growth than market growth in the period under review. For instance, the retail business increased it loan book by 16% – more than double the growth in total loan registrations in South Africa, with retail business growing 12% against 9% in the overall market.
Retail banking – a merger between wealth and insurance to drive efficiency and boost sales – operations accounts for more than 60% of its earning
ABSA’s interim Chief Executive Officer Rene van Wyk said, “We’ve made significant progress with ABSA’s reorganization following the implementation of our new strategy in March 2018, and we are beginning to see the benefits.”
This is the second year since the exit of London-based Barclays from the bank’s ownership. The move has allowed ABSA to shift its operations and strategy by increasing lending and focus on growing African business.