South Africa: Absa to Merge Retail and Private Wealth Units in Restructuring

9 December 2024
Daba Finance (Abidjan)
  • Absa Group plans to restructure its operations to boost growth and regain market share.
  • Efforts by South Africa's third-largest bank by assets comes after years of challenges.
  • Absa shares rose 8.7% on the Johannesburg Stock Exchange following the announcement.

Absa Group, South Africa's third-largest bank by assets, plans to restructure its operations to boost growth and regain market share after years of challenges. Interim CEO Charles Russon announced the consolidation of the bank's South African retail-lending unit with private wealth operations, reducing Absa's core units to four from five.

The move marks a reversal of the 2021 restructuring that segmented the retail and business banking division into multiple units. Russon said the changes aim to streamline operations, reduce internal tensions, and enhance customer experience.

Absa shares rose 8.7% on the Johannesburg Stock Exchange following the announcement, their biggest jump since June 2020.

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Key Takeaways

The restructuring reflects Absa's commitment to reposition itself in South Africa's competitive banking sector. With shareholder confidence shaken after three profit warnings in 16 months, the merger of key units signals a focus on operational efficiency and long-term growth. The changes come as the bank seeks to stabilize under interim leadership and prepare for its next phase.

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