Absa eyes Africa expansion as banks push beyond South Africa  

Absa Group, the Johannesburg-based financial services provider, is stepping up its push across the continent as growth outside its home market gathers pace, Chief Executive Kenny Fihla said Tuesday. 

While South Africa remains the lender’s biggest market, other African operations are becoming a stronger contributor to revenue and earnings. Executives say demand for banking services across fast-growing economies is opening the door for regional lenders to expand their footprint. 

Across the industry, South African banks are increasingly looking north. The shift comes as several European lenders scale back their presence on the continent, leaving space for African institutions to grow through acquisitions and partnerships. 

Last October, Standard Chartered agreed to sell its wealth and retail banking business in Uganda to Absa Group, strengthening Absa’s position in East Africa. 

The expansion push follows stronger financial results. Absa reported a 12.25% increase in full-year headline earnings to R24.8 billion ($1.51 billion), helped by growth in its corporate and investment banking division and operations outside South Africa.

East Africa seen as next growth area 

Fihla said revenue from the bank’s operations outside South Africa remains largely concentrated in Ghana and Kenya. However, Absa is looking to deepen its presence in Uganda, Tanzania and Zambia. 

The strategy includes strengthening the bank’s balance sheet, pursuing acquisitions where opportunities arise and expanding existing operations to reach more customers. Fihla said the lender is also working to improve coordination across its regional units and raise service standards. 

“There is no doubt that the African region presents some of the biggest growth opportunities for us,” he said. 

Zambia has drawn growing interest from international lenders because of its role as a major copper producer. Demand for copper and other minerals used in electrification and clean-energy technologies has placed the country in a stronger position within global supply chains.

Leadership reshuffle to support expansion 

Absa is also reinforcing its leadership team to oversee its broader African operations. A new head of personal and private banking is expected to begin in April, while the bank is finalising the appointment of an executive to lead its pan-African business banking unit. 

Fihla said the bank’s existing footprint across East Africa gives it an edge over competitors seeking to enter the region. 

“If you do not already have a presence, it becomes extremely difficult to take advantage of the opportunities,” he said. “We have that presence, which puts us in a stronger position.” 

Fihla leads Absa’s regional growth push

Founded in South Africa and listed on the Johannesburg Stock Exchange, Absa serves more than 12 million customers across 10 African countries. The group also maintains representative offices in Nigeria and Namibia, securities operations in the U.K. and U.S., and an advisory business in China. 

Fihla, who joined the bank as chief executive in June after nearly two decades at Standard Bank, is now leading the lender’s next phase of regional growth.

Last month, the bank also raised R3.2 billion ($193.57 million) through Financial Loss-Absorbing Capacity notes linked to ZARONIA, reinforcing its position in South Africa’s capital markets.