AFRICA – Barclays, a multinational universal bank, is expanding private-banking services in Africa, looking to target the continent’s US$2 trillion net worth market.
The British lender has hired nine bankers from Credit Suisse based in mainly Dubai, London and Zurich after agreeing a deal to handle clients referred by the Swiss rival, Barclays Private Bank CEO Jean-Christophe Gerard said.
“Barclays franchise in Africa is experiencing an accelerated buildout across south, west and east Africa. This will be done through organic growth and the referral agreement we have with Credit Suisse,” Gerard said.
The US$2.1 trillion of private wealth held on the African continent is expected to rise by 38% over the next 10 years, according to the Africa Wealth Report published in April.
The move by Barclays to expand in the area contrasts with its exit from retail banking in SA, where it recently sold the last of its holding in Absa.
About half of Africa’s super-rich individuals are from SA, Nigeria and Kenya, where a lot of the bank’s focus will be, Gerard said.
The lender has about 15 bankers in SA though is looking to hire more, Barclays country CEO Amol Prabhu said in the same interview. Other staff elsewhere are focused on the expansion.
Wealthy Africans are investing in technology firms, including those focused on agriculture, finance and health, according to Gerard. That has helped contribute to a boom in start-up investment on the continent.
“Entrepreneurs like to invest in entrepreneurs and therefore many are keen to participate in the Barclays direct-assets programme for instance,” said Gerard.
Investment in UK real estate is also accelerating, he said, with Africa’s super rich either seeing the market as an investment opportunity or holiday home or both.
In March 2016, Barclays announced it was going to separate from the South-Africa-based financial group ABSA (Amalgamated Banks of South Africa). By the end of 2017, Barclays had a little over 14% share in ABSA, from its initial 62.3%. Barclays PLC recently sold the last of its holding, 7.4% in Johannesburg-based Absa Group Ltd.
ABSA was formerly called the Barclays Africa Group but changed its name in 2017. Following this development, ABSA evolved into a more indigenous brand, while Barclays PLC moved to become an independent brand that operates in Africa.
Absa Group Limited’s Barclays-branded subsidiaries operate in seven Sub-Saharan African countries including Botswana, Ghana, Kenya, Mauritius, Seychelles, Tanzania, and Zambia.
With severed ties from ABSA. Barclays announced that it wants to continue its operations in Africa. The bank which has existed on the African continent for over a century now has noted that it is looking for ways to add value to Africa by expanding its scope of operations within the continent.