New-look Absa faces a tough task across Africa
With the sounding of a kudu horn by CEO Maria Ramos in the JSE’s atrium, Absa shed blue and one of the last remnants of its history with Barclays plc.
The cheer from executives clad in corporate wear with twinges of red heralded the end of the British bank’s 100-year history on the continent.
The group now has the task of changing its name to Absa across the continent.
While Barclays Africa Group is no more, Absa has the right to use the name until June 2020.
Peter Matlare, deputy CEO responsible for the rest of Africa, said that while they had the time it did not mean that Absa would wait until June 2020 to drop the Barclays name.
“Most of the separation from Barclays, the complex part, takes place across the 10 banks on the continent.
“So we are making sure we are doing that in a manner that when we launch the brand externally we have . . . the capability that makes sure we are delivering better than a brand that had been there for 100 years,” he said.
But the group has a tough job ahead of it to change the Barclays brand to Absa in 10 banks across the continent including those in Nigeria, Kenya and the Seychelles.
Nicola Kleyn, a marketing professor and dean of the Gordon Institute of Business Science, said Absa had a “big journey ahead” to acclimatise clients across the continent to the brand change.
Kleyn said the messaging around the brand was going to be important.
She said most of the success was not going to come from the colour and logo but from customer and retail business perception of Absa as relevant to solving their problems.
“At the end of the day it’s not going to be the question ‘Is this a bad name or a good name?’ . . . The question is ‘Can you make it meaningful and relevant in each of the countries it operates in?’ And that is going to take a lot of money,” she said.
As part of the separation agreement, when Barclays sold down its stake in Absa, it negotiated a R12-billion divorce settlement of sorts, to be used for rebranding Absa across the continent, improving technology systems and other separation-related projects.
Absa won’t disclose how much it has spent on the rebranding so far.
With the name change, Absa has tried to adopt a continental identity rather than one primarily identifying with its domestic market.
Nairobi-based investment advisor AlyKhan Satchu said he found it interesting that the newest iteration of Absa’s brand was less South African and more African and very millennial, and that it represented a significant reshaping and tilt away from Johannesburg and towards the rest of Africa.
“However, sitting in Nairobi, there is a very strong Kenyan bias as previous South African entrants have found. So the rebranding is quite a delicate thing requiring plenty of finance,” he said.
Absa embraced a geographical spread across the continent but non-South African representation was limited, raising uncomfortable questions about “South African imperialism”.
Out of the group’s 16-person board only three are non-South Africans and just two are from the rest of the continent: Alex Darko is Ghanaian, Francis Okomo-Okello is Kenyan and Daniel Hodge is British.
The group executive committee consists entirely of South Africans.
Kleyn said it was not disingenuous of Absa to claim an African identity as it launches its new brand without having representation in its top levels, but she said Absa would have to be more representative of the regions it operates in.
“It will have to; it makes good business sense as you need the diversity of the market represented in your top boardroom,” she said.
Matlare said that for more than a year they had consulted some 130 000 people — from politicians to regulators to community groups.
He added that global banks were exiting the continent as they de-risk, so the role of regional banks like Absa became more important.
“That’s why we are saying this is not a South African company. It happens to be domiciled here, but it is truly becoming an African company that we are all proud of,” he said.
Matlare pointed to examples of panAfrican businesses taking root already, such as Aliko Dangote’s business empire or the growth of banks like Mauritius Commercial Bank and Ecobank.
CEO Maria Ramos launches the rebranding of Absa at the JSE.