Less impairments boost Barclays Africa profits

File picture: Toby Melville, Reuters

File picture: Toby Melville, Reuters

Published Feb 11, 2014

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Johannesburg - Barclays Africa Group posted an expected 14 percent rise in full-year earnings on Tuesday, boosted chiefly by a decline in bad loan costs in its retail and commercial mortgages.

The African subsidiary of Britain's Barclays Plc said diluted headline earnings per share totalled 1,396.6 cents in the year to end-December, from 1,227.6 cents a year earlier.

Headline EPS, which excludes certain items, is the main measure of profit in South Africa.

The results are the first since Barclays sold most of its African operations to South African lender Absa in exchange for a bigger stake in Africa's third-biggest banking group.

That acquisition boosted headline earnings by 14 percent to 1.923 billion rand ($172.5 million).

The bank is aiming to be one of the top three banks by revenue in Kenya, Ghana, Botswana and Zambia, its four biggest markets outside South Africa, chief executive Maria Ramos told reporters.

Barclays, the first of South Africa's top four banks to report earnings this season, said credit impairments, or bad loan costs, improved 21 percent to 7 billion rand.

Net interest income, or profit made from lending, rose 10 percent to 32.35 billion rand.

Revenue from charges such as fees and commissions grew 5 percent to 27.1 billion rand.

Absa shares are down 6 percent this year, a slower decline than rivals such as No. 2 lender FirstRand, which has dropped 13 percent, and Standard Group, which has lost more than 9 percent. - Reuters

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