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The Reason Behind Barclays PLC Exit From Africa

Barclays PLC has announced that it is pulling out of Africa to focus on the US and UK markets

On Saturday, the Financial Times reported that the Barclays PLC board, headed by CEO Jes Staley, had decided to pull out of Africa to focus on the US and UK markets.

The company owns a 62,3% stake in Barclays Africa. Business Day reports that the company will sell its shares over a period of three years.

On Monday, Barclays Africa Group CEO Maria Ramos said the company is optimistic about its prospects in Africa. “We continue to be optimistic about our prospects in Africa, where we have a strong franchise with assets of over R1 trillion. We are deeply committed to the success of our continent. Our destiny is in Africa,” Barclays Africa Group CEO Maria Ramos said on Monday.

“Barclays Africa Group Limited (BAGL) wishes to reiterate that we remain committed to Africa, where we continue to be optimistic about our growth prospects, and to operate in the normal course of business,” the company said in a statement.

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On Tuesday, Barclays Africa shares tumbled 8% ahead of the big announcement.

“The (Barclays Africa Group) board notes that it is clear from this announcement that Barclays PLC is reducing its shareholding in Barclays Africa due to recently introduced regulatory burdens specific and particular to Barclays PLC as a UK-headquartered and globally significant financial institution,” the company said.

“These regulations significantly decrease Barclays Africa’s standalone returns for Barclays PLC.

“We will now actively engage with Barclays PLC and our regulators to ensure this process has an appropriate and satisfactory outcome for all our stakeholders,” Barclays Africa said.

Business Day has reported that the Public Investment Corporation is interested in buying a large stake in Barclays Africa, but has been waiting for Barclays PLC to announce its exit from the continent before making a move.

source: destinyman

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Written by PH

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