Barclays Seeks Investment Banking Licence In Nigeria -

Barclays Africa Group Limited’s corporate and investment
banking unit has approached the Central Bank of Nigeria
(CBN) for approval to convert its representative office in Lagos
to a full-fledged banking business.
The bank has been increasing its presence in Lagos in
anticipation of the approval from the CBN. Bloomberg quoted
the bank’s Head of Corporate and Investment Banking outside
South Africa for Barclays Africa, Temi Ofong, to have said in a
recent interview in Gaborone, Botswana.
The Nigerian licencing process could take at least 12 months,
Ofong said.
“We have an ongoing strategy to expand our footprint and we
have formally engaged the authorities in Nigeria to apply for
licences,” he said.
The Barclays Africa unit’s representative office has been
expanded to have 20 staff, Ofong said.
“These include investment brokers and a trade finance team
of four people out of Lagos.”
Standard Chartered Plc, Standard Bank Group Limited and the
investment banking unit of FirstRand Limited, Africa’s biggest
bank, all have operating licences in Nigeria.
The country’s economy will probably expand by 4.8 per cent
this year, more than twice as fast as South Africa’s projected
2.1 per cent, according to the International Monetary Fund
(IMF).
Barclays Africa worked on the sale of Mainstreet Bank
Limited, among distressed lenders bailed out by the CBN, to
Skye Bank Plc, Ofong added.
His unit has also been “short-listed” to manage a Nigerian
initial public offering, Ofong said, without giving details.
In addition to Nigeria, Barclays Africa sees corporate and
investment banking growth opportunities in Ghana, Egypt,
Kenya, Zambia, Mauritius, Mozambique, and Botswana,
according to Ofong.
The unit has been growing its assets by more than 30 per cent
on an annual basis “and we would want to continue going into
the new financial year,” he said.
If Barclays secures the licence, it will mark the bank’s second
entry into the Nigerian banking space.
Set up by the British colonial administration in 1917, Barclays
was one of Nigeria’s largest banks after independence. In
1969, Barclays was incorporated in Nigeria as Barclays Bank
of Nigeria Limited to comply with the country’s banking laws
enacted in 1968.
However, the bank was forced to withdraw following the
Indigenisation Decree promulgated by the Nigerian military
regime in the 1970s in protest against Britain’s refusal to
sanction the apartheid regime in South Africa.
Following Barclays’ departure, the successor bank was named
Union Bank of Nigeria (UBN).
Recently, Atlas Mara, the African investment vehicle of former
Barclays boss, Bob Diamond, increased its stake in UBN
having acquired a 20.9 per cent stake in UBN from the Asset
Management Corporation of Nigeria (AMCON).
Barclays’ re-entry into the Nigerian economy confirms
analysts’ forecasts that activities in the merchant banking
segment of the financial market would increase this year, as
the market anticipates the entrance of more players in the
sub-sector.
This is also expected to support corporate and trade financing
in the country.
Presently, there are two licensed merchant banks in the
country – FSDH Merchant Bank Limited and Rand Merchant
Bank.
Kakawa Discount House Limited that has also been granted
an approval-in-principle by the CBN is expected to commence
operations this year.