Absa still keen on Namibia as part of its Africa plan

ABSA still intends to increase its presence in Namibia despite failing to secure a local lender in the region earlier this year, says John Gachora, the head of Africa at Absa Capital.

The African expansion plan follows that of competitors such as Standard Bank, which has a 10-year start on the continent.

Earlier this year Namibia authorities blocked Absa's bid to gain control of Bank Windhoek, citing concern about foreign dominance.

However, the Namibians have since announced that they will allow "credible foreign banking institutions" to open branches in the country to promote competition in an industry that is dominated by a handful of lenders.

Gachora is tasked with growing Absa's presence in Africa.

The financial services group has a representative office in Namibia and one in Nigeria through Absa Capital.

Gachora is "very cautious" about the most populous country in Africa, considering what has transpired in the country's banking sector in recent years.

Nigerian authorities spent $4-billion bailing out nine banks last year.

Absa, unlike FirstRand and Standard, has not expressed interest in acquiring any of the distressed banks.

Absa Capital's representative office in Nigeria is being used by the group to gain insight into the market. Yet Gachora said Absa was aware that one "cannot be big in Africa banking if you are not in Nigeria".

He has a three-pronged approach to expanding Absa's African presence.

The first step is to continue investing where Absa is already operating, such as in Mozambique and Tanzania.

The second is to leverage parent company Barclay's presence in nine countries.

"We intend to use its footprint to sell products it does not offer," Gachora said.

The third part of the strategy is to grow the company in new markets such as Nigeria and Namibia and look at returning to Angola.

Absa once had 50% of Banco Comercial Angolano, but sold out.