Absa reveals further customer losses
Absa has on Tuesday (11 February) reported a loss of 940,000 clients in its retail banking arm.
In announcing its financial results for the year ended, December 2013, Absa pointed to a decline in transactional customer numbers from 9.78 million to 8.84 million, due to the closure of 800,000 social grant-related accounts. The bank had 12.1 million customers in 2011.
The total excluded cards in issue for the Edcon portfolio and Woolworths Financial Services of 4.8 million and 200,000 respectively, the bank said.
“We will retain our leading position in retail and business banking in South Africa,” Absa CEO Maria Ramos, said in presenting the results to analysts. “South Africa remains our biggest market,” she said.
Ramos pointed to a continued investment in technology. “Some R1.2 billion in upgrading our network, and significant investment in innovation and digital banking,” she said.
Ramos said that the company’s customer attrition had stabilized, “and customer numbers are increasing in important market segments, like core middle market, and retail affluence”.
The financial services’ parent company, Barclays Africa Group, released its full year results for 2013.
The earnings are the first since Barclays sold a large chunk of its African operations to Absa in exchange for a larger stake in the group, to 62.3%.
Barclays Africa Group said its headline earnings increased 14% to R11.84 billion,while total revenue advanced 8% to R59.4 billion.
The company declared a dividend of R8.20 for the year and made a special payout of R7.08.
Internet banking
Absa only marginally grew its internet banking customers in South Africa, to 1.227 million, from 1.176 million in 2012, and from 1.203 million in July 2012.
The group increased its ATM compliment in SA, to 9,618, from 9,547 in 2012. Outlets however, declined to 829 in SA, from 874 in 2012.
Absa Digital Banking
IT infrastructure
Total IT spend, including related staff, amortisation and depreciation, grew 8% to R6.414 billion and accounted for 19% of group expenses.
Amortisation of intangible assets grew 44%, reflecting increased investment in systems.
Professional fees grew 68% to R1.578 billion, which included substantially higher strategic initiative spend on project delivery and systems.
Staff costs increased 11% to R17.6 billion to account for 53% of the total.
Absa Delivery Footprint
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