Uganda: Barclays Bank Weighs Risk of Name Change

After more than 100 years using the Barclays name in Africa, Barclays Africa Group will finally let go after its parent firm sold majority interest in it. The task now is to get the brand that will appeal to its 11.6 million customers across the continent, writes ALON MWESIGWA.

At the Barclays Towers, 15 Troye Street in Johannesburg, tens of bankers occupy an entire floor piecing together the divorce journey of Barclays Africa Group Limited (BAGL) from parent firm Barclays PLC.

One of the questions that pre-occupies their minds is what name or colour Barclays Africa will adopt when it ceases using its parent brand.

"We're saying what is it [that we must do] to make sure we get it right?" said Peter Matlare, the group deputy CEO. "We want to see that at no stage our customers feel any level of concern."

"It is a delicate process. If people's experience about us is bad, they dump us and talk bad about us. If we deliver on the things we say we want to deliver, we'll have the opportunities," he added.

The Barclays name and brand has been a common feature in the countries where it has been operating for more than 90 years. In South Africa, the bank has operated there under the Barclays brand for more than 100 years.

After sale by the London-headquartered Barclays PLC of its majority interest in in BAGL, the latter will cease to use the name and brand of the former.

BAGL's businesses in Uganda, Kenya, Ghana, Mauritius, Mozambique, Seychelles, Tanzania and Zambia, too, will have to change to a new identity.

"Brand represents many things. We'll leverage off the heritage of the Barclays PLC brand," Matlare said.

Barclays PLC announced on March 1, 2016 that it intended over a two to three-year period to reduce its shareholding in Barclays Africa Group Ltd. As at June 2017, it had sold majority of its shares from 62.3 per cent to only 23.4 per cent of the Africa business. There are media reports it could sell down further to 15 per cent.

This means Barclays Africa cannot continue to use the brand and name of Barclays PLC since it is no longer the majority owner. In a statement in May, Barclays PLC said the separation arrangements include contributions from it to BAGL totalling £765m (about $1bn).

At least £515 million would be to provide additional capital to BAGL to "allow it to make investments required to achieve the separation, including in respect of technology, rebranding and other separation projects".

Songezi Zibi, BAGL head of corporate communication, said the bank was now looking at the basket of names testing their acceptance in the public.

In South Africa, where it is the biggest bank, it is already trading as Absa - which stands for Amalgamated banks of South Africa.

But this is fairly unknown in other jurisdictions on the continent. In other markets like Uganda, the Barclays name is expected to cease in the next two to three years.

"Absa is one of the names being considered to be rolled out on the continent," Zibi said. One of the considerations is to assess what people feel about Absa."

"We've been very careful not to assume that it will be Absa. We are going through a much disciplined process."

Neil Maree, the deputy head of banking supervision at the South African Reserve Bank, said change in brand does bring risks and concerns. He said the South African central bank was leaving to the group to decide whether they adopt a single brand to cover all the subsidiaries on the continent or take the hybrid that would see the subsidiaries take a different name.

"We'll have to approve and monitor how the branding will be carried out," Maree said. "The bank will also have to engage in-country regulators for approval."

Going forward, Matlare said there were genuine concerns that the bank would cut staff after the separation. He said the group already believes it has the great talent and "wants to remain home to that talent."

He said the group was exploring a way to give shares to staff in the company as one way of motivating them to change culture and know what they are building is theirs.

Matlare said all workers in countries where they operate will have opportunities to own shares in the bank as a way of incentivising them.

Asked about whether after separation, the group will consider listing its subsidiaries in countries like Uganda on local stock exchanges, Matlare said they would look into this after they have completely separated from Barclays PLC.

He added, however, the bank would look into expanding in markets like Nigeria and Angola, where it is currently not operating.