Executive bloodbath looms at Absa
● Barclays Africa Group may halve the number of top jobs at its South African retail and business bank as it reorganises after its British parent cut its stake, according to a source familiar with the matter.
The bank started talks to consult executives on a plan that may result in the reduction of top management roles from 27 to 12 to flatten the company’s management structure, said the source, who declined to be named.
Once the consultation process is completed, the jobs will be advertised and executives who aren’t selected will be considered for employment elsewhere in the company, the source said.
Each person affected by the changes could remain on the bank’s payroll for up to three months before deciding either to stay with the bank or move on.
Barclays Africa is reverting to the Absa Group name and revamping its strategy after Barclays Plc cut its controlling stake to below 15% to trim back its international operations. CEO Maria Ramos is embarking on a second round of top management changes after announcing in April that she was refocusing the company around four main divisions — retail and business banking, corporate and investment banking, rest of Africa, and wealth management and insurance.
The South African retail and business banking division “is the first to commence a process of overhauling its structure” so that it fits with an organisational culture built around entrepreneurial drive and accountability, while “restoring market leadership in our core businesses”, Barclays Africa said in response to questions.
“The aim is to create businesses that are agile” and collaborate well, it said, declining to comment further until the process was complete.
Arrie Rautenbach, CEO of the retail and business bank, would keep his job, the source said.
Plans to cut the number of executive jobs come a month after deputy CEO David Hodnett, who in May last year was put in charge of the retail bank, resigned before completing a two-month sabbatical.
Craig Bond, CEO of partnerships, joint ventures and strategic alliances, stepped down on Thursday after choosing to take early retirement, according to an internal memo.
Barclays Africa’s operating expenses rose 2.9% faster than revenue growth in 2017 as the lender struggled to boost income amid an anaemic economy and unemployment at a record high. “The economy is weak, so getting top-line growth is going to be difficult,” especially in the retail-banking business, said Adrian Cloete, an analyst at PSG Wealth in Cape Town. “It makes sense that they look at their costs.”