Barclays Africa reports decline in first-half income

Barclays Africa reports decline in first-half income

Barclays Africa Group Limited on Thursday reported a notable decline in total first-half income, delivering further evidence that the economy of South Africa is not going to climb out of the financial doldrums anytime soon.

It is the first interim contraction reported by Barclays Africa Group since Maria Ramos took charge as chief executive officer of the Johannesburg-based lender in 2009.

The strain of contraction in the South African economy also appeared in the 10 per cent decline in earnings excluding one-time items at the lender’s main South African consumer division in the January to June period.

The lender’s income from fees on transactions and commissions as well as deposits slipped 14 per cent, while costs jumped faster than revenue.

In a newly released statement, Barclays Africa said, “Key risks facing South Africa in the second half include heightened political and policy uncertainty in the run up to the ruling party’s December elective conference … and for weak business and consumer confidence to lead to a longer, more protracted recession.”

Barclays Africa’s stock further slipped on Friday, leading declines in other stocks on the six-member FTSE/JSE Africa Banks Index. The recent decline in the stock extended the lender’s losses to 14 per cent this year.

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