Out of Africa: Barclays' Absa sale raises £538m

Barclays has completed its exit from Africa after selling its remaining 7.4 percent stake in its South Africa-based subsidiary Absa.

The British lender told investors on Thursday that it had raised gross proceeds of around £538 million from the placement of 63 million Absa shares at 169 rand (£8.48) a share, a loss on the sale of £31 million .

It marks both the end of a 2005 investment and the end of Barclay’s 97-year presence as owner of companies on the African continent.

The bank says it will continue to have a representative office in Johannesburg capable of supporting investment, retail and corporate clients.

Barclays shares fell 1.5 percent to 162.08 pence in early trade, bringing the year-to-date loss to 17.3 percent.

The banking giant’s intention to exit Africa was announced in 2016 under the leadership of then-boss Jes Staley, who had sought to simplify operations and focus on its key US and UK markets.

A year later, the company sold a larger stake in Absa than the market had anticipated, reducing its stake to 15 percent due to strong demand.

Staley left the lender in November 2021 after the Financial Conduct Authority and Prudential Regulation Authority launched an investigation into his ties to disgraced dead financier and sex offender Jeffrey Epstein.

Staley denies the city regulators’ investigation, but Barclays earlier this year froze long-term bonus and stock payments he is owed as a result.

Originally known as Amalgamated Banks of South Africa, Absa offers personal and commercial banking, credit cards, corporate and investment banking, wealth and investment management, and bank insurance.

With offices across Africa, as well as in London and New York, Barclays’ takeover of the bank in 2005 was later criticized by South African Reserve Bank Governor Tito Mboweni.

Absa later merged with Barclays Africa Limited in 2013.