Barclays Sells Zimbabwe Bank to Malawi’s First Merchant

JOHANNESBURG (Capital Markets in Africa) – Barclays has announced the sale of its Zimbabwe bank to Malawi-listed First Merchant Bank on Friday as the British lender continues its exit from Africa. In March Barclays announced it was in talks on the sale of its stake in Barclays Bank of Zimbabwe as part of a broader exit from Africa to refocus on the United States and Britain.

Barclays said the deal would remove 292 million pounds ($375.69 million) in risk-weighted assets from its balance sheet. All 700 Barclays Bank of Zimbabwe employees will transfer to the new owner, Barclays said. The deal is expected to complete in the third quarter of this year.

On Thursday Barclays cut its stake in Barclays Africa Group to 15 percent sooner than expected , ending more than 100 years as a major presence in the continent. The bank said it was selling 2.2 billion pounds worth of shares in its African business due to strong investor demand. Barclays said it would sell shares worth 1.5 billion pounds in its second rapid share sale. The bigger figure lifted shares in Barclays, which is partly relying on the funds to meet capital requirements identified as a concern by the Bank of England. On Wednesday the shares were up 0.2 percent, while Barclays Africa was up 4.6 percent. Barclays said that once the business is deconsolidated from its accounts, the sale should eventually boost its core capital ratio by 73 basis points, although it will lead to an initial 1.2 billion pound loss.