One of Africa’s Largest Financial Services Groups
Absa Bank Limited (Absa Bank) is a wholly owned subsidiary of Barclays Africa Group Limited, which is listed on the Johannesburg Stock Exchange and is one of Africa’s largest financial services groups. After achieving the remarkable 2017 Banker of the Year – South Africa award status, the bank’s Head of Partnerships, Joint Ventures and Strategic Alliances Craig Bond provides a compelling and detailed look at the banking industry in the region.
Absa Bank Limited (Absa Bank) offers a range of retail, business, corporate and investment banking and wealth management products and services primarily in South Africa and Namibia. Further details about the products and services Absa Bank offers are explained by their Head of Partnerships, Joint Ventures and Strategic Alliances Craig Bond, as this interview begins:
“In South Africa, we are simply known as Absa. Most people know us because of our retail business but our portfolio is more diverse than that, and so are our customers. They vary from students receiving monthly allowances from their parents to large public and private sector corporates concluding extensive deals with the bank.
“We tailor and provide solutions for all of them so that we can include as many people as possible in the financial system, and to grow our business. SMEs fall in our business banking space while larger corporates use us for a variety of services including lending, trading, investment banking and other needs in other areas of our business.”
Absa Bank has a diversified portfolio of business in South Africa:
• They have a significant retail banking business with branches and ATMs in all 9 provinces.
• Absa has 9.4 million customers; an R918 billion balance sheet and almost 28,000 employees, supporting their portfolio of businesses.
• Their business banking business includes agriculture as well as asset & vehicle finance.
• Their corporate and investment bank provides corporate, lending, advisory and trading products to a variety of public and private sector clients.
• Their WIMI business provides wealth, investment management, fiduciary and insurance products to millions of South African entities and individuals.
Describing just how it feels to be awarded the 2017 Banker of the Year – South Africa accolade, is something that Craig is very keen to share with us.
“I am deeply humbled. These awards are a team effort and I dedicate it to my fellow 42,000 colleagues who, despite various economic factors, have continued to serve our customers and communities with both passion and dedication.
Following the 2008 global economic crisis, it became evident that there was a need for better regulation of financial services groups to ensure that institutions were stronger, more resilient and less exposed to risky assets. Craig gives us Absa Bank’s perspective on this.
“Regulations were also introduced to stop money laundering, tax evasion and other illegal activities. While these regulations are necessary, crossborder banking has become more complicated and costly. This threatens the future of global and regional financial services groups.
“The decline of global groups and correspondent banking services makes remittance of foreign earnings to families, access to export markets for small and medium enterprises and the provision of banking services to multi-national companies, significantly more difficult.
“These regulations are also likely to result in fewer, larger domestic banks, as institutions struggle to meet regulatory requirements and maintain international correspondent banking relationships. This will reduce competition in local markets.
While better regulation of financial institutions is necessary, we must be aware of any unintended consequences and find ways to mitigate them.”
Despite the regulations introduced following the 2008 global economic crisis, Craig reveals where Absa Bank fits into this picture and outlines the role they are playing in the banking industry today.
“At the heart of our culture, lies our shared growth philosophy, if the communities in which we operate grow, then we grow. It means delivering client and customer solutions that address their current and future needs. It also means an employee culture that places our clients, customers and communities at the centre of everything we do.
“We take our role as a pan-African bank very seriously and are heavily investing in education and entrepreneurship across the continent. This year alone we are committing R210 million to fund 3000 university students. We also have an ongoing commitment to financial inclusion, providing wider access to disenfranchised communities. We have chosen these areas, as they are powerful enablers of growth and development.
Craig then discerns Africa’s greatest resource and sharpest competitive advantage in the global economy and Barclays Africa has a philosophy of shared growth.
“Africa’s greatest resource and sharpest competitive advantage in the global economy is its young and growing workforce. By 2040, Africa is expected to have the largest workforce in the world, 40% of which will consist of young people. But the economic growth the continent has enjoyed in recent years, has not created enough opportunities for its young people to use their talents, to earn sustainable livelihoods.
“Barclays Africa has a philosophy of shared growth, recognising that as a responsible African corporate citizen we must use our expertise and resources to find sustainable, commercial solutions to the challenges of inequality, poverty and unemployment. Our shared growth initiatives focus on education, enterprise development and financial inclusion. These are areas where we have the expertise and resources to help include people in the economy and improve their lives.
“ReadytoWork is the flagship Shared Growth programme. It provides young people with free skills training, online and in workshops, to prepare them for the world of work.”
Craig then underlines that getting access to modern financial services can be life changing for people who simply had no access, plus he adds his thoughts on how the bank is performing today.
“We dedicate significant resources towards maintaining a wide footprint of ATMs and branches in metropolitan areas and small, rural towns. We have a partnership with major African clothing retailer PEP, to further extend these services. We also see the high penetration of mobile phones as an opportunity to grow access to internet and cell phone banking which are far cheaper than traditional propositions.
“I am proud of the work we do in this area. It is not cheap to maintain this infrastructure, but we are committed to maintaining as wide a footprint as our business can sustain, and to provide innovative platforms and services to all customer segments.”
“The bank’s 2016 performance has been resilient as we have sustained the positive direction outlined in our three-year plan. Our performance over the past year was, to an extent, hindered by the weakening economic conditions across the continent as well as market volatility brought about by global events such as Brexit. The fact that these events did not throw us off track is testament to the strength and resilience of our strategy.”
Just last year alone, Absa Bank’s retail & business banking team delivered the following.
They delivered customer propositions relevant to the target segments:
• Free MegaU Youth Account for the 0 to 19 year olds;
• The Silver Student account and affordable study loans for those of university going age;
• The Young Professional proposition and;
• The launch of Business Essentials Light, a more affordable transactional account aimed at the SMME market.
The bank has made it easier for a customer to join:
• Re-engineered their customer onboarding process enabling them to source FICA documents online from national data sources;
• Ability for their customers to digitally upload their FICA documents;
• Account number portability- allowing customers to keep their number for life and;
• Improved customer onboarding processes, to ensure a seamless new product experience in Business Banking South Africa, including the launch of the Instant Online Business Account.
They worked on making it more desirable for customers to stay with them:
• Extending customers’ ability to purchase prepaid electricity at the ATM and on the banking App;
• Enhancement to the Home Loans Home Buyers app, for an improved and convenient customer experience;
• Ability for the customer to utilise the banking App with no usage of the customer’s data;
• Revamp the look and feel of the Absa online banking platform, Absa website, the Absa banking App, and the USSD offering and;
• Delivered on systems stability initiatives resulting in significantly lower system downtime in our branches, ATMs and banking apps, greatly improving customer experience and;
• Enhanced automation of existing processes resulting in greater efficiency and turnaround times.
Absa Bank have been recognised for their delivery as evidenced below:
• Winner of 2016 Lafferty Global AwardExcellence in Retail Banking;
• Winner of the Social Media Awards, for Absa Chat Banking on Twitter, The Banker Technology Awards 2016;
• Voted number two in the Ask Africa Orange Index Awards 2016/2017 in the Banking Industry category;
• Best Retail Bank in South Africa, 2016 Banker Africa Southern Africa Awards and;
• Also, Barclays Africa won the 2016 Lafferty Group Global Award for excellence in retail banking. http://www.businesslive.co.za/bd/ companies/financial-services/2016-12-13barclays-africa-and-fnb-win-global-awards/.
Craig is enthusiastic to reveal the essential role that staff play in the bank’s extraordinary success story.
“Our colleagues are the heartbeat of this organisation and it has taken the contribution of every one of us, working side by side, over the years, to be where we are today.
“Our skills development work is intended to build our own talent pipeline, create exciting career opportunities for our people and to build a very strong leadership pipeline to support the growth of our bank. Embedded in this is transformation.
“We have made very strong progress in this area, from graduate development to on the job training as well as specialised programs designed to provide staff with technical skills and management capability to support our transformation objectives. In 2016, 73% of our skills training expenditure were focused on black colleagues.”
In conclusion, Craig is delighted to offer his own upbeat thoughts on the future of Absa Bank, in what is a very important industry sector in South Africa today.
“The business case for Africa is strong. It has 16 of the world’s fastest growing economies and this expansion is expected to continue despite some global economic headwinds
“Barclays Africa has a diversified portfolio of businesses operating in 12 countries across the continent and is determined to continue growing across all its markets. Our results show that that the group has resilience and momentum.”
Company: Absa Bank
Name: Craig Bond Head of Partnerships, Joint Ventures and Strategic Alliances
Web: www.absa.co.za Address: 7th Floor, Barclays Tower West 15 Troye Street Johannesburg 2001 South Africa