Pretoria – Cabinet says it has noted Barclays PLC’s announcement of its intention to reduce its 62.3 percent shareholding in Barclays Africa Group Limited (BAGL) over the next two to three years.
The shareholding will be reduced to a level - less than 20% - which will permit the deconsolidation of BAGL for accounting and regulatory purposes. This is subject to relevant shareholder and regulatory approvals in each jurisdiction. Barclays PLC will remain a major shareholder in BAGL.
“Barclays PLC, in particular the CEO, has engaged both the National Treasury and the Reserve Bank in an open dialogue, and we welcome the company’s commitment to implement its new strategy in a way that will minimise the impact on the economies in which BAGL operates,” said a Cabinet statement issued by the Government Communication and Information System (GCIS) on Thursday.
Barclays PLC said the key driver of the decision was global regulatory pressures. The return on equity at group level is significantly reduced because of the additional capital and other regulatory requirements a large global bank such as Barclays needs to meet such as the globally systemically important bank (G-SIB) buffer, the minimum requirement for own funds and eligible liabilities (MREL) and total loss absorbing capital (TLAC) requirements and the UK Bank Levy.
Cabinet said the Reserve Bank will work with Barclays PLC and BAGL to ensure that any potential risks from the transaction are mitigated and appropriate measures will be taken to manage capital flows arising from the transaction. – SAnews.gov.za
