Absa keen to claw back market lead

Absa is having a hard time convincing some investors it can win back market share lost under Barclays’ control.

SA’s third-largest lender was once the leading retail bank with over 10 million customers and more mortgages on its books than any of its Johannesburg-based peers. Now, released from the shackles of London-based Barclays, Absa CEO Maria Ramos can take on more risk with a plan to grow revenue faster than her rivals by 2021.

Absa lags FirstRand, Nedbank and Standard Bank in average number of products per customer and client loyalty. It lost market share among the youth, mass market, middle-income and affluent groups. It was 2018’s worst performer in the six-member SA banking index.

It’s still early in the game since Ramos, 59, brought in new management in March and restructured the retail and business banking unit, which accounts for more than half of earnings and deposits and 60% of loans. The division unveiled its strategy in December, which pivots on first fixing the basics, such as lowering costs, then adding clients and improving retention rates by focusing on customer needs beyond only banking. It also plans to reward long-standing clients with better offers and will cross-sell products between business segments to drive growth.

At least two new digital banks are due to launch in 2019, including Discovery and TymeBank. First National Bank and Nedbank are also becoming more aggressive in tactics to attract consumers and improve their use of digital channels.

Ramos, after 10 years at the helm, is expected to remain there at least until all operations have been rebranded in June 2020 in the rest of Africa from the Barclays brand to Absa.