Banking group Absa on Tuesday (29 October) confirmed its sale of the Edcon store card debtors’ book to RCS Group, a subsidiary of BNP Paribas Personal Finance.
The transaction is subject to regulatory approvals and includes the sale of Edcon’s store card debtors’ books in both South Africa and Namibia, the bank said in an emailed statement.
“The sale is positive for Absa as it will free up capital and management time to focus on executing against the strategy that Absa announced last year,” said Arrie Rautenbach, chief executive officer, Retail and Business Bank, Absa. “In terms of the strategy, our priority is to regain our leadership in core areas,” he said.
RCS Group meanwhile, has entered into commercial agreements with Edcon for the rights to provide consumer finance products to Edcon customers, inclusive of credit cards, store cards and personal loans.
“The transaction cements RCS as the pre-eminent provider of outsourced credit solutions in the region, providing an indication to the market that BNP Paribas Personal Finance is committed to South Africa,” said BNP Paribas in a statement.
RCS said that the transaction will be settled by a combination of internal cash resources and funding to be provided by Rand Merchant Bank and The Standard Bank of South Africa.