Moderate increase in Barclays revenue

BARCLAYS Africa Group yesterday reported a 6% increase in full-year revenue to R63.2-billion for the year ending in December as several of its key markets came under pressure.

“Growth in the Barclays Africa markets outside South Africa moderated‚ given a more adverse external environment,” the bank said.

“Despite resilient economic growth in several of these countries‚ fiscal pressures continued to build in several markets and rating agencies reacted with a mix of outlook or rating downgrades.”

Barclays said diluted headline earnings a share rose by 10% to 1 537.5c‚ while credit impairments fell by 10% to R6.3-billion compared with 2013.

The bank had an improved return on equity to 16.7% from 15.5% and declared a final dividend of 525c a share.

Operating expenses grew 7%. South African costs grew 6%. The group said this was in line with inflation‚ while the other African operations increased by 10% “given continued investment spend”.

Staff costs rose 10% to R19.3-billion to account for 54% of total expenses.

Looking ahead‚ the bank said it expected a continued recovery in the global economy as uncertainty around US Federal Reserve tapering diminished‚ although it expected volatility to persist this year.

“South African growth [is] likely [to] recover from the strike-ridden 2014‚ as the impact of modest fiscal tightening is offset by a boost to household disposable income benefits from lower petrol prices,” the company said.

“Electricity shortages remain a binding supply-side constraint on growth.”

It said as South African interest rates were likely to remain low for longer, it did not expect the group’s net interest margin to improve further this year‚ although its loan growth should increase.