London-based Barclays Plc cut its controlling stake in the African business to 14.9 per cent last December, resulting in a rebranding of Barclays Africa Group to Absa in July this year.
The Kenyan unit has started negotiating with vendors to migrate banking systems from London with rebranding and marketing campaign costs set to kick in afterwards, managing director Jeremy Awori said.
Antony Mulisa, who was Barclays Kenya’s regional treasurer for East Africa, has been appointed the transition programmes director to oversee the separation process.
Barclays Bank of Kenya #ticker:BBK , which has until June 2020 to adopt the Absa brand, says it sees a spike in operating costs from the second half of the year as it embarks on a splitting process from UK’s Barclays PLC.
London-based Barclays Plc cut its controlling stake in the African business to 14.9 per cent last December, resulting in a rebranding of Barclays Africa Group to Absa in July this year.
The Kenyan unit has started negotiating with vendors to migrate banking systems from London with rebranding and marketing campaign costs set to kick in afterwards, managing director Jeremy Awori said.
Antony Mulisa, who was Barclays Kenya’s regional treasurer for East Africa, has been appointed the transition programmes director to oversee the separation process.
The bank, publicly traded on the Nairobi bourse, is yet to work out the costs of separation whose impact will be felt on its financial books in the next few years.
“One upside of the separation from (Barclays)PLC is that we are not obligated to buy or use PLC-based systems because some of their systems were maybe not the newest or most modern systems, but we were obligated as being part of their family to use those systems,” Mr Awori said.
“We want to transform our business and will be investing in new channels and products to run our business even more effectively and competitively in the future.”
The lender has adopted “the normalisation principles to reflect the true business performance” which will see the one-off transition costs ring-fenced, it said in a statement.
Some of the systems such as cards payment platforms will be replaced with newer ones while others will be upgraded.
“In there, there will be investments into tangible assets. We are not going to move with, for example, fully-depreciated servers. There are some systems that we are still negotiating with different vendors,” chief financial officer Yusuf Omari said.
“The branding elements is also work in progress. It is too early for us to give you a number (costs). We will come to you once all that has been finalised,” he said in response to the Business Daily’s queries.
Barclays Kenya is still battling in court with a firm called ABSA Kenya Ltd, which has laid claim to the Absa brand and wants orders to permanently block the lender from using the brand name in Kenya.
“In the immediate future, what you can expect to see is us sharing more about the credentials and the thematic background behind Absa as we build up awareness about Absa across the continent,” Mr Awori said.
