The seasonally adjusted Absa Purchasing Managers Index (PMI) increased to 53 index points in February from 50.9 in the month before. The further increase was supported by three of the five subcomponents gaining relative to January. Only the employment index moved lower, while the supplier deliveries index also ticked down but remained well above the neutral 50-point mark and thus supported the headline figure.

The most encouraging outcome of the February survey was a continued improvement in new sales orders. Following a rise in January, the index rose further to 54.0 index points, which is the best level since October 2020. The improvement was supported by better export sales relative to the previous month, while the loosening of local lockdown restrictions also contributed to an uptick in domestic demand. The improvement in orders supported an increase in the business activity index. Following four consecutive declines, the activity index rose by a sizeable 8.6 index points in February. The increase suggests that production growth reaccelerated after losing steam towards the end of last year. The inventories index also regained all of January’s losses and moved back above the neutral 50-point mark.

Purchasing managers remain relatively optimistic about the six-month outlook, with the expectations index unchanged at 59.2 index points. A factor which may quell sentiment going forward could be continued upward pressure on costs. This is likely, especially if the demand environment remains relatively weak and producers cannot pass on these costs to mitigate some pressure on profitability. Indeed, after a sharp increase the previous month, the purchasing price index rose further. A hefty fuel price increase at the start of February likely contributed to the continued acceleration in cost pressure. Fuel prices are expected to rise further in coming months on the back of a higher Brent crude oil price as well as an increase in fuel levies. A sharp hike in electricity tariffs will also push up costs.

• PMI February Infographic 2021
• Absa Purchasing Managers Index February 2021

Absa Group today pledged R10 million to the newly-established Gender-Based Violence and Femicide (GBVF) Private Sector Response Fund, and will also provide free banking services to the fund for 12 months.

Launched by President Cyril Ramaphosa, the Fund seeks to bring together all sectors of society and will serve as a vehicle to mobilise resources to support and enable scalable programmes, targeting both prevention and response to GBVF across South Africa.

“Gender-based violence does not only hurt its direct victims, but society as a whole. At Absa we recognise that as a large organisation it touches the lives of people from all walks of life, and we have a responsibility to play a shaping role in our society,” said Absa Group Chief Executive Officer Daniel Mminele.

Absa will also provide further support to the fund in the form of:

• Project management capacity for the establishment of the Fund;
• Designing and setting up a website and basic marketing activities and;
• Developing a donation and disbursement process – in conjunction with the administrator.

“Gender-based violence is not just a law enforcement problem, but a problem for all of society that demands everyone to respond meaningfully and consistently in order for women and girls to be safe at all times” Mminele said.

Absa’s pledge to the GBVF Response Fund builds on various initiatives undertaken in 2019 and 2020. Some of the initiatives have included signing up to the UN’s HeforShe programme, working with men in communities and within Absa to break the cycle of violence, hosting a number of dialogues around gender-based violence, and collaborating with various institutions to ensure a portion of public procurement spend is earmarked for women-owned businesses.

Absa’s pledge will contribute towards changing social norms and behaviour, as well as broadening access to justice for victims.

Absa Group has been selected to serve on the Payment Card Industry Security Standards Council’s (PCI SSC’s) Board of Advisors in 2021 and 2022. In this role, Absa is able to help shape the development of payment data security standards and programmes globally.

The PCI SSC leads a global, cross-industry effort to increase payment security by providing industry-driven data security standards and programmes that help businesses detect, mitigate and prevent cyberattacks and breaches. Absa Group Chief Security Officer Sandro Bucchianeri will represent Absa on the board for the third consecutive year.

Absa is one of 31 board members, alongside Google, Apple, Amazon and the European Card Payment Association among other organisations. As strategic partners, board members bring industry, geographical and technical insight to PCI SSC plans and projects.

“The Board of Advisors provides industry expertise and perspectives that influence and shape the development of PCI Security Standards and programmes. We look forward to working with Absa in our efforts to help organizations secure payment data globally,” said PCI SSC Executive Director Lance J. Johnson

Separation technology programme receives high commendation in “Best Tech Overhaul” category

Absa Group, one of Africa’s largest financial services providers, won first place in the ’Fintech for Good’ category at the 2020 Banking Tech Awards ceremony yesterday, in recognition of its South African-based Cybersecurity Academy initiative.

Absa’s technology separation from Barclay’s PLC, which included the single largest data and system migration in Africa, received a high commendation in the ’Best Tech Overhaul’ category. The awards programme, hosted by FinTech Futures, a UK-based digital publishing platform, recognises excellence and innovation in the use of IT in financial services worldwide, as well as the people who make it happen.

The Absa Cybersecurity Academy, established in partnership with the Maharishi Institute, provides cybersecurity training for marginalised youth in Johannesburg and Cape Town, with the aim of securing work placements with affiliated organisations.

Says Sandro Bucchianeri, Group Chief Security Officer at Absa, “Since a young age, I have been incredibly passionate about security. COVID-19 has shown us more than ever how important it is, and addressing the global shortage of cybersecurity professionals is an urgent challenge. Absa’s Cybersecurity Academy means a great deal to me; it contributes to the efforts to break the cycle of poverty and build the resilience of organisations across the country.”

To find out more about the Absa Cybersecurity Academy, watch the video here.
For more about the technology separation programme, watch the video here.

Absa advises that an employee has unlawfully made selected customer data available to a small number of external parties. The leaked data relates to a small portion of Absa South Africa’s customer base to date, although investigations continue.

Upon discovering the contravention, Absa secured High Court orders that enabled search and seizure operations at various premises and secured all devices containing the data. The data on these devices was subsequently destroyed.

Absa has enhanced the monitoring of customer accounts that have been affected to date, and we will contact customers directly.

Absa has brought criminal charges against the employee, and internally the requisite consequence management has been undertaken. Absa may take further action in relation to the recipients of the data once the full scope of the leak is identified and all investigations are completed.

Absa has put in place additional control measures to minimize the risk of reoccurrence in future.

The Absa Purchasing Managers’ Index (PMI) (link to attached PMI Report – November 2020.pdf) declined to 52.6 index points in November from the solid 60.9 points recorded in October. The decline comes after three consecutive upward moves and brings the index to the lowest level since July 2020. While still signalling an improvement in business conditions, the drop suggests that the manufacturing sector’s recovery is starting to lose momentum. This was to be expected as output levels for many subsectors are nearing pre-pandemic levels and will need sustained demand growth to fuel a further output expansion. In this regard, it was worrying to see the new sales orders index dip back below the neutral 50-point mark for the first time since May. This was in part driven by a renewed decline in export sales, which could possibly be linked to lower activity in Europe due to the renewed COVID-19 lockdowns. This, as well as concerns about coronavirus developments in South Africa, likely explains why purchasing managers turned less positive about business conditions going forward. The indicator tracking business conditions in six months’ time dipped for a second month to 52.7 index points and is now about 12 points below the level of just two months ago. While positive news regarding vaccine developments may result in an improved global growth outlook over the medium term, the next six months remain highly uncertain. 

In addition to the new sales orders index, the other four components of the headline PMI also declined relative to October. However, encouragingly, both business activity and inventories still signalled expansion. Even so, the fact that both indices fell by about 10 points suggests that the pace of the recovery has slowed significantly. Furthermore, the employment index dipped lower in November. Unlike the other indices, employment never breached the neutral 50-point mark in its recovery from the lockdown-induced slump in April. The supplier deliveries index remained high in November, suggesting that supply chain and product availability are still constraints.

Finally, the purchasing price index came down from a two-year high reached in October. The deceleration in cost pressure was likely driven by the, on average, stronger rand exchange rate which lowers the rand-cost of imported raw materials and intermediate goods.

Please note that the December 2020 PMI will be released on 8 January 2021. Due to the December holidays, we don’t release it on the first working day of the month as usual.

• Absa PMI November 2020
• PMI November Infographic 2020

Absa Group Financial Director Jason Quinn was named CFO of the Year at the 2020 CFO Awards on 25 November.

Jason won three of the ten awards, including the ‘Strategy Execution Award’ and the ‘Moving into Africa Award’ at the annual event, known as the ‘Oscars for finance executives’.

The awards programme, in its seventh edition this year, is organised by CFO South Africa, an organisation that connects finance professionals through executive events.

Jason was recognised for his instrumental role in the separation of Absa from Barclays, a three-year, multibillion-rand programme, which was completed on time and below budget during 2020. The awards also recognise his role in Absa’s expansion and in dealing with substantial changes in the business environment.

“I congratulate Jason for his excellent achievement and well-deserved recognition. We are truly proud to have someone of his calibre as part of the Absa family and our leadership,” said Daniel Mminele, Absa Group Chief Executive.

Jason joined Absa in 2008 as financial controller and he was appointed as head of finance in 2014 after holding several senior finance positions. He joined the Absa Group board and executive committee as group financial director in 2016.

Absa Group has won an award from the Institute of Risk Management South Africa (IRMSA) for the best Industry Specific Risk Initiative (financial category) in response to the COVID-19 pandemic. Absa also received the South African Publication Forum Award for the best COVID-19 Intervention in relation to its corporate communications strategy.

The awards recognise Absa’s efforts in ensuring that the group continued to service customers across Africa daily, while adjusting to fast-moving government regulations in multiple countries and, at the same time, implementing substantial operational changes to enable more than 20,000 staff members to work from home across 14 countries.

Employee communication was key to effecting large-scale changes efficiently, and focused on three key themes: mental and physical wellbeing; resilience and security; and, new policies and procedures.

“The accolades bear testimony to the hard work and dedication of all our colleagues across the bank who have worked tirelessly – and continue to do so – to keep colleagues, customers, and communities safe during the pandemic while ensuring continued operational and financial resilience of our organisation” said Daniel Mminele, Absa Group Chief Executive.

The response to the pandemic required collaboration and execution between all parts of the organisation in ways not seen before. By invoking response structures early, Absa was able to anticipate and avoid some of the impact felt in other organisations.

From the very early stages of the COVID-19 pandemic, Absa created an integrated ‘war room’ to manage the response. The war room consisted of a multi-disciplinary team from across the entire group. The war room later became the Absa COVID-19 Advisory Board and consisted of members from the corporate real estate, physical security, wellness and people function, communications, compliance, legal, risk, finance, technology, audit and customer facing business units. 

The latest awards follow earlier recognition in a MyBroadband survey in June in relation to the CEOs’ response to COVID-19. Absa also received an award for Excellence in Leadership in Africa from Euromoney in July for its integrated COVID-19 response in terms for people, clients, and communities. Absa was one of six banks globally that were recognised for outstanding performance during an unprecedented era of constant change and uncertainty as a result of the global health crisis. 

In September, Absa was the recipient of the Business Continuity Institute Africa Award for the Most Effective Recovery, recognising the resilience it demonstrated in the face of the impact of the COVID-19 crisis.

“A huge amount of work has been done by many to ensure that, as a critical service, we were able to continue to serve and support our customers through this crisis in a sustainable way,” said Mminele.

Absa Group has announced that it will support entrepreneurship through its partial funding of the 1000 Tech Entrepreneurs Programme, assisting aspiring South African entrepreneurs in creating innovative technology businesses. The programme, undertaken by technology ecosystem Silicon Durbs, provides a structure in which entrepreneurs learn how to start and grow their businesses while identifying and solving industry and real-world challenges.

Andrew Davies, Digital Partnerships Ecosystem Lead at Absa Group, says that unemployment statistics highlight the importance of initiatives like that of the 1000 Tech Entrepreneurs Programme. “This year has shown us more than ever that large corporates should be supporting entrepreneurial ventures in order to create employment opportunities. Added to this, it is the fresh and innovative thinking of technology entrepreneurs that gives rise to the type of startups that solve real-world problems.”

Lindani Mkhize, founder of Silicon Durbs and campaign lead for the 1000 Tech Entrepreneurs Programme, says that they are on track to discover the next wave of South African tech entrepreneurs and businesses. “We’re hoping to stimulate a culture of technology entrepreneurship that can be copied in other African markets and prestigious supporters like Absa help us to bring this dream to life, while creating an ecosystem with stakeholders that are willing to collaborate, partner and support each other.”

Absa currently works with over 40 entrepreneurs through its innovative WorkInProgress ecosystem which supports and connects technology start-ups with potential development and growth partners.

Absa is supporting phase two of the 1000 Tech Entrepreneurs Programme which consists of ideation bootcamps, running from November 2020 until March 2021, focusing on connecting industry challenges with participating entrepreneurs. This stage involves those entrepreneurs that don’t necessarily have an initial idea, but rather just an interest in developing tech business solutions for particular industries. The five-day boot camps are hosted in different locations around South Africa and consist of value proposition design, product engineering sessions, brand development sessions, general sales skills, networking and pitching.

The 1000 Tech Entrepreneurs Programme is open to all South Africans and previous entrepreneurship experience is not a requirement.   Registration for the programme can be done online: https://1000techstartups.co.za.

Absa Group Limited’s cybersecurity team was named the ‘Not for Profit Team of the Year’ at the 2020 Cyber Security Awards on Thursday, 10 September 2020.

The award was made in recognition of Absa’s role in the Absa Cybersecurity Academy, a collaboration with the Maharishi Institute, that provides marginalised youth with the opportunity to become certified cybersecurity specialists. The Johannesburg-based academy was expanded in August with the launch of a Cape Town leg.

Absa’s Group Chief Security Officer, Sandro Bucchianeri, was ‘highly commended’ in the cybersecurity industry ‘Personality of the Year’ category, which recognises efforts to promote the sector.

Established in 2014, the Cyber Security Awards programme, organised by the eponymous company, recognises top performers in the cybersecurity sector. Founder Karla Reffold, currently a director at UK and US cybersecurity recruitment business BeecherMadden, was among the judges.

“Cybersecurity has evolved rapidly into one of the most important areas in the banking sector. Absa therefore considers it as critical that we have top resources looking after this area,” said Paul O’Flaherty, Absa Group Chief Executive: Engineering Services. “We are proud that our team’s efforts within the company, and in being a force for good, are being recognised.”

“As a CSO, one dreams of leading a phenomenal team and being recognised in an international awards programme,” said Bucchianeri. “I’m exceptionally proud of my team, and we look forward to doing more to support the development of the industry while uplifting the communities in which Absa operates.”