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African Bank Limited, is a retail bank in South Africa, that offers financial products and services. The Bank is licensed as a "locally controlled bank" by the South African Reserve Bank (SARB).[3] Headquartered in Midrand, South Africa, the bank has a countrywide branch distribution network in addition to a full digital channel offering; as well as sales, collections and customer service Contact Centres.[4]

As of 30 September 2022, African Bank Limited had total assets worth ZAR:28.695 billion, with shareholders' equity of ZAR:11.080 billion.[2] In 2019, the bank, its subsidiaries and affiliates employed 3,886 people.[1]

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In May 2022, African Bank announced a deal to acquire Grindrod Bank in addition to their holding company Grindrod Financial Holdings. African Bank stated that the acquisition worth R1.5 billion, will aid the introduction of business banking into their services since Grindrod Bank has 26 years of specialisation in the corporate and investment banking sector.[11]

With a thorough understanding of the intricate regulatory and financial environments in North America and Africa, we provide treasury, trade finance and correspondent banking services to institutions doing business in Africa, as well as facilitate the flow of investment capital, development capital, and trade between Africa and the U.S. Click here to contact our relationship and product managers.

We are the U.S. arm of United Bank for Africa (UBA), the leading sub-Saharan African bank with over 21 million customers, 20,000 employees, and 1,000 branches across 20 African countries. Headquartered in Lagos, Nigeria, UBA has been providing superior financial services to small businesses, corporations, governments, institutions, and individuals globally since 1948.

As they chart their paths to recovery, African banks should be cognizant not only of their returns to shareholders but also of their broader responsibility to society. Indeed, banks will face increasing expectations from regulators and customers in the months ahead, in two main areas.

First, banks are fundamental to the large-scale relief that needs to be distributed to corporates, SMEs and individuals. As conduits of stimulus packages introduced by governments, banks will have to channel aid and enable loans for the economy. African countries are employing a range of measures, including extending state-sponsored loans and making relief payments to individuals through bank channels. In Morocco, for example, laid-off workers have received compensation for salaries and benefits of $200 a month for those in the formal sector and $100 a month for those in the informal economy. Similarly, South African banks are the primary enabler of a $30 billion stimulus-package injection into the economy, including a $12 billion SME lending program. In Nigeria, a $2.5 billion lending program has been established to support local manufacturing and other key sectors.

Second, both consumers and regulators expect banks to be able to keep lending, and at scale. In a recent McKinsey survey of African consumers, Moroccan and Kenyan customers ranked facilitated access to credit as their top expectation from banks during and beyond the COVID-19 crisis. In Nigeria and South Africa, it is among the top five expectations from banks (Exhibit 1).1McKinsey Financial Insights Pulse Survey, May 8, 2020.

For most banks, the risk function is at the heart of COVID-19 crisis response. There are immediate actions that banks can take to minimize risk, but the crisis also allows an opportunity to revamp the credit process for greater efficiency and effectiveness. Banks can leverage digital and analytics to improve both lending journeys and credit decision making.

However, digital financial offerings and credit engines specifically targeted at SMEs remain an area of limited innovation for both banks and Fintech players. Early signs of solutions emerging here include POS-lending and merchant credits offered by payments service providers, but these are nascent.

Finally, banks can partner with FinTechs. Over the last few years, African FinTechs have grown in number, providing strong innovation in payments and lending methods. Banks have an advantage of trust and a large customer base, but are slower to innovate than Fintech players, while many Fintech players are very innovative and possess talent, but are unable to scale and do not enjoy the same level of trust as banks. Partnering with them could offer an important lever for banks to accelerate their own innovation in risk models and address talent gaps while enabling Fintech players to achieve scale.

Our analysis suggests that African banks might be required to achieve productivity gains of between 25 and 30 percent if they are to restore pre-crisis profitability. Banks can take two short-term actions to manage costs and consider five long-term strategies to radically re-think operating models and boost productivity. By our analysis, these measures could result in productivity gains of up to 30 percent, along with greater customer experience and faster decision making.

African banks currently have among the highest cost-to-asset ratios in the world: at between 4 and 5 percent, twice the global average. Banks could choose this moment to structurally review their cost base and operating models. This is particularly important if banks want to increase bancarization by including lower-middle-income and mass-market clients into the banking system in a cost-efficient manner.

The recent accelerated adoption of remote services by customers will require banks to upscale their digital capabilities. To capitalize on changes in consumer preferences and accelerate digital transformation, banks can consider the following two key short-term actions:

As digital financial services evolve, banks will face mounting competition from three main nonbanking competitors: (i) telcos that are expanding their activities into payments (via mobile finance and beyond); (ii) major global technology players, such as Alibaba and Tencent, which have already developed a strong activity in financial services outside Africa and who are now showing increasing interest in the continent; and (iii) digital attackers such as FinTechs, which have made inroads both in the consumer services and in corporate services spaces . This competition from non-banking players will be enabled by regulation and technology: for example, regulations issued in Morocco and Nigeria in 2018 are enabling payment-service providers, mostly telcos, to provide payment services.

Banks that do not embrace mobile finance and integrate it seamlessly into their banking activity face the threat of losing market share to these nonbanking competitors. To adapt successfully to the long-term shift to digital, banks can accelerate their digital transformation by prioritizing the following specific milestones:

For long-term structural change, banks can focus on measures to embrace digital transformation and accelerate financial inclusion. They can achieve this by driving mobile finance and scaling up services to SMEs, with the following key actions:

The workplace is characterised by numerous contracts of agreement that an employee and employer must sign to formalise their employment relationship. The informal agreement, known as the psychological contract, is often overlooked, although it is pivotal in determining the engagement of employees in an organisation. This study aimed to probe the perceptions line managers have of the influence of the psychological contract on employee engagement in a South African bank with a particular focus on how the integration of technologies from the Fourth Industrial Revolution may have impacted the workplace in the banking sector. The study was carried out using a qualitative research approach. A purposive random sampling strategy was used to select participants who were interviewed using semi-structured, one-on-one interviews. The data collected were analysed using thematic analysis, and verbatim quotes were used to support emergent themes. The findings of the study revealed that continuous change in the world, exacerbated by the COVID-19 pandemic, influences employee expectations. Thus, organisations must be able to quickly adapt and adjust their talent attraction and retention mechanisms. Talent management, the nature of the business, structure and operations, the nature of the work environment, and emotional needs are the themes that emerged from the study. With the constant change in the world of work, including industry disruptions continually imposed by the 4IR and other factors, employees' expectations are ever-changing. Thus, organisations must keep adapting to attract and retain talent. This study adds value by addressing various aspects aligned with competitively adjusting to the current and future world of work.

The ABIL Board announced its decision to sell Ellerine and endeavoured to find a buyer. African Bank is the only South African bank exposed in this way to a furniture chain. Ellerine Furnishers was placed into a business rescue process on 7th August 2014. One of the outcomes of this is that the significant monthly financial support required from ABIL and African Bank has ended.

The problems that have beset African Bank are, in our view, largely specific to their current business model, which does not include a diversified set of products and income streams, nor does it offer transactional banking services. This has made African Bank and the ABIL Group uniquely vulnerable to a changing or challenging business environment, such as currently prevails. e24fc04721