Goodbye Barclays, hello Absa

ABSA Group headquarters in Nairobi.

Change is inevitable, and after 104 years, the blue had to go.

Last week, Barclays Bank ended its Kenyan expedition, transitioning to Absa, which explains why the lender has been painting the town red, literally.

The newest kid on the block inherits a rich history that it hopes to build on as it charts its own path.

The burden to live up to the hype or become even better than its old self, Barclays, has never been harder. But what’s in a colour or a name? Absa Managing Director Jeremy Awori has the answer: “New energy and vibrancy,” said Awori following the transition.

“We want to paint the town red. Starting today, we have an exciting programme and agenda,” added Awori.

At the unveiling of the Absa ticker at the Nairobi Securities Exchange (NSE) last week, hope coupled with nostalgia swept in.

The transformation journey saw the temporary suspension of trading of the Barclays Bank Kenya shares to allow for completion of the transition.

And as Awori took the podium, Kenya’s corporate elite looked up with curious and contemplative faces as if to signal the hard task ahead.

Resplendent in a black power suit and a red tie, Awori explained that going forward, the lender would strive to be customer-centric.

To ensure this, the CEO said, Absa that has a presence in 12 African countries, would merge the century old experience it had inherited from Barclays with new cutting-edge technology.

“We’ll combine the best of our century-long past experience with new cutting edge technology, innovative products and now a vibrant new brand Absa,” he said.

“If we are going to thrive and succeed, we need our customers to thrive. We’ve had very candid conversations with them on what they feel banking and financial institutions should be providing them with to help them achieve their dreams, goals and aspirations,” added Awori.

It is, however, not lost on him the enormity of the task at hand as he leads his team in building a brand with a “rich heritage, innovative and trusted financial partner.”

“We are transitioning from being a bank to being a holistic financial services institution that includes banking products, Absa Securities that does investment and brokerage and we’ve received a licence for asset management,” he said.

News of Barclays’ exit from the African market first broke out in mid-2017. Barclays Africa Group had sold a significant stake to Absa Group Ltd. However, the transition has not been without hiccups, including a fall in profitability. Absa itself has a large foot print with 1,000 branches, over 10,000 ATMs and a workforce of over 10,000 across the continent.

Awori promised to make announcements of new products as the bank embarks on what he called a “digital-focused future.”

He said they had relaunched small and medium enterprises (SME) propositions to include unsecured loans of up to Sh10 million, LPO financing and discounting of up to Sh50 million and focus on microfinancing.

The lender also recently launched Kenya’s first vertical debit and credit cards.

On supporting housing - a key pillar in the President Uhuru Kenyatta’s Big Four agenda, the Absa Bank Kenya boss said the lender had the “best” and most “affordable” mortgage rate at 11.57 per cent.

On the transition, the Central Bank of Kenya (CBK) detailed how the lenders had moved from serving the interests of the British colonial settlers to now serving the wider Kenyan public.

It is perhaps with this in mind that Awori set out to dispel the notion of the bank being “elitist”, saying that era was long gone.

“That’s the past image that Barclays has had. Absa is a much more inclusive, fun brand that will connect with young people, SMEs and entrepreneurs,” he said, adding that the larger part of the bank's business would be retail banking.

Following the rebrand, CBK had further urged the bank to be more customer-centric, especially in the pricing of loans.

“Only by being more customer-centric, fair and responsible in pricing, transparent and ethical will Absa Kenya breathe life into its transformation,” said the banking regulator.

Over the years, Barclays has been a bank of many firsts and was key in the transformation of the local banking sector.

In 1959, it opened a school for cashiers and employees on its Government Road branch, now Moi Avenue.

Later in 1967, the school would produce the first African women cashiers to be employed by the bank.

The two, Amina Rajab Abdullah and Zeinab Maulidi, were 19 years old and had been students at the Nairobi Muslim Girls School.

In 1977, Elizabeth Okelo became the first woman bank manager in Kenya - heading the Westlands branch.

In historical records obtained by the Financial Standard, Sir Julian Crossley, the chairman of Barclays (1947-1966), said the most important contribution by the bank to new East African nations was the assistance it provided in introducing modern banking systems.

“If we are asked what contribution we have made to the advancement of the developing countries, the answer need not be confined to the work of financial development,” he said.

Sir Crossley said the bank helped the new countries establish their own banking system, and even as the tag exits Kenya, most of the country’s banks are modelled on the British banking system.

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