South Africa has for the third year running, claimed top position among 20 African countries ranked by the Absa Africa Financial Markets Index in terms of financial markets development. This is mainly because of its sizeable lead in market depth and deep market liquidity supported by strong domestic investors.

The country was also ranked top in access to foreign exchange, market transparency, tax and regulatory environment and capacity of local investors. It however came second to Egypt on macro-economic opportunity and third on legality and enforceability of standard financial markets master agreements after Mauritius and Kenya, respectively.

The index, now in its third year, assesses progress and potential across six key pillars and was produced by the Official Monetary and Financial Institutions Forum (OMFIF), an independent research think tank for central banking, economic policy and public investment.

The countries were ranked based on the following pillars:

Pillar 1
Market Depth: Examines size, liquidity and diversity of products in markets, as well as countries’ efforts to merge exchanges and launch new markets.

Pillar 2
Access to foreign exchange:  Looks at factors that impact markets’ accessibility to international investors, including the severity of capital controls, exchange rate reporting standards and levels of foreign exchange liquidity.

Pillar 3
Market transparency, tax and regulatory environment: Assesses countries’ regulatory and tax environments for financial markets, as well as transparency and enforcement of accounting rules.

Pillar 4
Capacity of local investors: Examines the size of local investors, assessing the level of local demand against supply of assets available in each market.

Pillar 5
Macro-economic opportunity: Evaluates economic performance, financial risks and financial transparency, demonstrated by availability of data, open monetary policy communication and the timely release of state budgets.

Pillar 6
Legality and enforceability of standard financial markets master agreements: Measures how well countries have adopted internationally accepted legal standards, the enforcement of netting and collateral positions, and insolvency regime adequacy.

The head of global markets for Absa regional operations, George Asante says South Africa’s top ranking across four pillars is not surprising given the development and sophistication of its financial markets. However, other countries ranked in the index are fast catching up due to ongoing regulatory and policy reforms in those markets, which Asante partly attributes to the impact the index is having.

“South Africa tops the index largely due to its sizeable lead in market depth. While it is likely to remain an outlier in this pillar, the creation of new bourses and key mergers between existing ones will improve the standing of other countries in coming years,” Asante says.

South Africa’s high position on access to foreign exchange after having been overtaken by Kenya in the previous edition of this index was as a result of high interbank foreign exchange turnover, regular exchange rate reporting and a favourable reserve level relative to net portfolio flows.

In the market transparency, tax and regulatory environment pillar, South Africa’s scored highest on its tax environment for financial markets which plays a crucial role in offering investors incentives to invest in financial products. “They provide transparency, which is vital for fostering investor confidence,” Asante says.

South Africa beat other countries on the fourth pillar of capacity of local investors because of its deep and liquid capital markets which offer local pension funds many investment options.  “Its pension funds are also large relative to the capitalisation of assets listed on the Johannesburg stock market, which means they contribute to its liquidity and development, as well as benefitting from it,” Asante says.

Commenting on the overall findings, Asante says the impact of the index is demonstrated by the progress financial regulatory authorities are making to further reform their financial markets across African markets.

“There has been a concerted effort among African policy-makers to react to the findings. This can be seen in the vast improvements in Pillar 6, ‘legality and enforceability of standard financial markets master agreements’, where countries have responded to past findings in order to align with best practice. The index is therefore becoming a powerful barometer for policy-makers and playing a role in building an Africa which is able to fund itself,” he says.

Peter Matlare, Deputy Chief Executive Officer, Absa Group, meanwhile says the deepening and widening of financial markets are crucial steps towards national economic self-sufficiency in Africa.

“To reach the next level of growth, Africa requires a collective commitment to ensuring the transnational cross-pollination of ideas. This index suggests we are making headway. The continent’s challenges are clearly visible and its countries are crafting actionable solutions,” Matlare says.

He says Absa is committed to furthering the development and prosperity of the continent and its people. The bank believes the insights in the index will inspire active engagement among policy-makers and market participants, resulting in measurable actions that foster inclusive growth and sustainable development which benefits the people of Africa.

We have partnered with the Maharishi Institute (MI) to set up the Absa Cybersecurity Academy to address a skills shortage. The programme is an externally focused, corporate social responsibility initiative aimed at empowering marginalised South African youth, who would otherwise not have had access to a tertiary education. The learners who participate will become certified cybersecurity analysts.

South African youth from marginalised backgrounds are hungry for opportunities to develop skills that will result in employment. They are often unable to access tertiary education due to financial circumstances and without education their future is bleak and the cycle of poverty continues.

Given the enormous need for skilled cybersecurity professionals locally and globally, we saw the opportunity to truly make a difference. The youth aged 15-24 years are the most vulnerable in the South African labour market. Statistics SA reported that the unemployment rate among this age group was 55% in the first quarter of 2019, while Cyber Ventures estimates that the global shortfall of cybersecurity jobs will rise to 3.5 million by 2021.

It is a challenge partially rooted in the socio-economic environment, the growing void between youth skills, employer needs and because the South African education system is failing to train the next generation for the digital economy.

Unlocking hidden talents that will make the African continent the hub of cybersecurity talent; we have the people, we just need to help them rewrite their futures.

View our YouTube video for more on our CyberSecurity

Absa Corporate and Investment Banking (CIB) was recently appointed by Bayport Management Ltd (Bayport) to be the joint book runner in the first ever USD social bond to be issued by a corporate in Africa.

The US$260 million senior unsecured social bond, which is due in 2022, was heavily oversubscribed, reflecting investors’ recognition of the positive social impact of Bayport’s services on the markets in which the group operates. The bond has since been listed on the Nasdaq Stockholm Sustainable Bond List.

Social bonds are instruments whose proceeds exclusively finance or re-finance projects that deliver a wider social impact. In Bayport’s case this includes job creation through small and medium-sized enterprises financing, as well as financial inclusion.

Absa’s participation in the Bayport social bond is aligned to the bank’s strategy to be a force for good in society, which focuses on providing finance and assisting clients to achieve sustainable economic growth in the markets it operates, says David Renwick, Head of Investment Banking at CIB.

“There is a definite trend from global investors to invest in more socially responsible projects and companies because they want to see their funds are being invested in responsible activities. Green bonds were the first type of socially responsible investing instruments and have been around for at least a decade. In Africa, green bonds have been issued in countries such as South Africa and Nigeria,” says Renwick.

“But social bonds are newer, and while there have been a few such bonds issued in the past, the International Capital Market Association (ICMA) published its Social Bond Guidelines in 2018 to provide a disclosure framework meant to promote integrity in the development of the market by clarifying the approach for issuing a social bond,” he says.

Renwick says Bayport chose Absa because of the long-term relationship the company has with the bank. “Because they wanted to issue in the international market, it was critical for them to partner with a bank that understands their business and risk profile. It therefore became a natural choice to appoint Absa as the only African bank on this transaction,” says Renwick.

He adds: “Absa is ready to assist other corporates interested in issuing social bonds because we have both the expertise and access to institutional investors and other global financial institutions with an appetite for these instruments.”

Bayport Capital Markets Executive, David Rajak, says the successful USD corporate social bond issue affirms that social relevance underpins Bayport’s business, and that the market recognises it.

“This, together with the group’s sustained robust financial performance, has helped drive a significantly broader base of investors compared to Bayport’s six previous bonds issues in the international capital markets. One of Bayport’s core values is to enable economic and self-empowerment by giving access to life-changing financial solutions, which is what we will do with the capital raised through the social bond”.

Rajak adds that “the social rating is an affirmation of Bayport’s customer-centric business model. “While our funding partners have long been aware of this, it is great to have it independently acknowledged as well. The social rating cements our commitment to be a socially responsible and relevant credit provider, and to lead market innovation in our industry.”

Bayport’s Botswana operation was the first credit provider in Africa and first payroll lender in the world to achieve Client Protection Certification by The Smart Campaign.

Absa Bank Limited (“Absa”) acted as Joint Global Coordinator, Bookrunner, Mandated Lead Arranger and Facility Agent on the refinance and upsize of Harmony Gold Mining Company Limited’s (“Harmony”) existing U$350m term loan and revolving credit facility with a new 3+1 year U$400m term loan and revolving credit facility (the “Facility”).

The syndication of the Facility was oversubscribed, confirming the confidence of the participating banks in the credit quality of Harmony, their mining assets and the strength of their balance sheet.

Absa’s support for the deal reaffirms its status as a leading funder of projects in the mining sector in South Africa and the rest of Africa. According to Tawanda Madondo (Senior Coverage Banker Natural Resources – CIB ) Absa’s understanding of the global gold industry and in depth knowledge of Harmony led to the successful syndication the Facility.

Harmony has expanded from being the third largest gold mining company in South Africa to the largest, in part due to organic growth and acquisitions – some of which Absa has supported.

“The success of the deal means local and international banks have strong credit appetite for successful South African companies like Harmony ” says Andrew Sprenger (SA DebtTransactor – CIB). “We were able to lead deal roadshows in Johannesburg and London to ensure the oversubscription of the Facility – and in the process, reconfirmed Absa’s credentials as a leading debt financing franchise in the market and a core relationship bank to Harmony”.

Harmony intends using the Facility to grow existing operations and grow its asset base in South Africa, Papua New Guinea and the rest of Africa. Herman Perry (CFO – Treasury) from Harmony commented that, “Absa played a key role in the successful conclusion of the Facility – both from a Lender, Bookrunner and Global Co-ordinator perspective. We are pleased to partner with Absa on our growth journey”.

Absa Group Limited today became one of the Founding Signatories of the Principles for Responsible Banking, committing to strategically align its business with the Sustainable Development Goals and the Paris Agreement on Climate Change.

By signing the Principles for Responsible Banking, Absa joins a coalition of 130 banks worldwide, representing over USD 47 trillion in assets, in committing to taking on a crucial role in helping to achieve a sustainable future.

Taking place at the start of the UN General Assembly, the official launch of the Principles for Responsible Banking marked the beginning of the most significant partnership to date between the global banking industry and the UN. “The UN Principles for Responsible Banking are a guide for the global banking industry to respond to, drive and benefit from a sustainable development economy.

The Principles create the accountability that can realize responsibility, and the ambition that can drive action.” said UN Secretary-General Antonio Guterres at the launch event, attended by the 130 Founding Signatories and over 45 of their CEOs.

As expressed in the Principles for Responsible Banking, Absa is convinced that “only in an inclusive society founded on human dignity, equality and the sustainable use of natural resources can our clients, customers and businesses thrive”.

By signing up to the Principles, we commit to “using our products, services and relationships to support and accelerate the fundamental changes in our economies and lifestyles necessary to achieve shared prosperity for both current and future generations”.

“A banking industry that plans for the risks associated with climate change and other environmental challenges can not only drive the transition to low-carbon and climate-resilient economies, it can benefit from it,” said Inger Andersen, Executive Director of the United Nations Environment Programme (UNEP). “When the financial system shifts its capital away from resource-hungry, brown investments to those that back nature as solution, everybody wins in the long-term.”

The Principles for Responsible Banking are supported by a strong implementation and accountability framework. By signing them, Absa commits to being transparent on both our positive and negative impact on people and planet. Absa will focus where it has the greatest impact – in its core business – and set, publish and implement ambitious targets to scale up positive and address any negative impacts in line with global and local goals.

“We are very proud to be one of the first African banks to commit to the UNEP FI Principles for Responsible Banking,” said René van Wyk, CEO of Absa Group.

“We continue to include sustainability practices into our business, meeting a number of notable milestones in our pursuit of long-term value creation for clients, shareholders, and society as a whole.

“We acknowledge the social and environmental dilemmas facing our continent and our ability to responsibly influence all aspects of sustainability: economic, social, as well as environmental. With our declaration to the Principles for Responsible Banking, we affirm and express our willingness to assume an active leadership role in bringing about sustainable changes in Africa,” van Wyk said.

The Principles for Responsible Banking will provide Absa with an effective framework to systematically identify and seize new business opportunities created by the emerging sustainable development economy, while at the same time enabling the bank to effectively identify and address related risks.

Two of Absa Group’s subsidiaries have been named overall winners of the Market Leader Award in the 2019 Euromoney Cash Management Survey.

Barclays Ghana and Barclays Zambia were each ranked overall winners in their respective markets in the Market Leader Award category. Barclays Ghana was further awarded the Best Service Overall prize.

Commenting on the recognition, Absa Regional Operations Deputy Chief Executive, Temi Ofong said: “Delivering consistent superior services is what builds long-term success for us as a business and for our customers. Our cash management services provide a holistic offering and includes managing cash flow, banking solutions and a host of additional services.

“We are delighted to receive this recognition and endeavor to continue meeting the evolving needs of our customers,” added Yasmin Masithela, Managing Executive for Transactional Banking in CIB.

The Euromoney Cash Management Survey recognises the leading providers of cash management products and services. The survey covers 12 product and client categories on a global and regional basis, ranking results in 56 countries.

EuroMoney surveys cash managers, treasurers and financial officers worldwide. The survey reports the standard of international and domestic cash management services that corporate customers receive from their bankers. The scope included international and domestic payments, collections, liquidity management and other services.

Respondents (Corporate customers, Financial and non-Financial) are asked which top three banks they mostly use for their cash management services and to rate services provided by their lead Cash Manager on sliding scale of 1 being poor to 7 being excellent.

Corporate customers were surveyed to provide their feedback directly to EuroMoney based on the experience they have had with Cash Management services.

Absa Group Ltd. advises of the appointment of Swithin J. Munyantwali, currently chairman of the Barclays Bank of Uganda board, as non-executive director to the Absa Group Ltd. board with effect from 15 September 2019.

Swithin, who was born in the United Kingdom and currently lives in Uganda, is the head of international law firm Appleton Luff’s East African office.  He is vice-chairman and co-founder of the International Law Institute African Centre for Legal Excellence.

“We are delighted with Swithin’s acceptance of the appointment, which, we believe, will enrich board discussion, given Swithin’s extensive international experience in a variety of roles in a number of countries,” said Wendy Lucas-Bull, Chairman at Absa Group Ltd.

Swithin currently serves as a board member of the African Philanthropy Forum, and International Law Institute, in Washington, DC.  He is also a member of the advisory boards of the Case Western Reserve University, Emerging and Frontier Markets Association, and The New Markets Lab.

He holds a B.Sc. in Criminal Justice from St Joseph’s University, a Juris Doctor from the Case Western Reserve University School of Law, and a Masters in International and Comparative Law from the Georgetown University Law Center, all in the United States.

Swithin will continue to serve as Chairman of Barclays Bank of Uganda until the end of February 2020.

WorkInProgress, Absa’s Innovation Lab, hosted a hackathon in Cape Town last week where students, business and academia came together to develop ideas on what Africa can do to influence the current and future industrial revolutions.

The challenge of the hackathon was to develop solutions to activate the financial sector in Africa’s fifth industrial revolution in order to access opportunities for integrating business and academia. Participants from a number of African countries, between the ages of 20 and 55, gathered at the Absa Dome on the side-lines of the World Economic Forum on Africa 2019, where this year’s theme was ‘shaping inclusive growth and shared futures’ in the current industrial era.

“Absa committed in 2018 to being a force for good and playing a shaping role in society,” says Charmaine Lambert, Manager at WorkInProgress, Absa’s Innovation Lab. “The WorkInProgress centre is key in facilitating and hosting debates and events aimed at finding new solutions that will ultimately make a difference in people’s lives.”

“Africa is not a bystander in the current or next industrial revolution,” she explains. “We have a significant part to play and events such as this hackathon give people from all walks of life the opportunity to bring solutions to the table.”

Lambert adds: “The winning team, who named themselves ‘Green Rover’, came up with a solution-driven platform called ‘Inte-Grate’, an idea which won them R40 000 and the opportunity to further develop and co-create their concept at our Innovation Lab.”

“Their solution is essentially a web and mobile platform, which is integrated into our education system that uses competitive and reward-based incentives to teach people about technology,” she explains. “The futuristic financial adviser will provide advice that is stored in a blockchain database.”

On how the winners were selected, Lambert says that they were adjudicated by a panel and judged on specific criteria such as teamwork, ideation process, thought process during the challenge, originality, uniqueness and execution of their solution.

“It was a very inspiring and innovative day with our 16 participants from South Africa, Rwanda, Congo, Kenya, Zambia and Israel and we are very fortunate to have such great minds to help our continent move towards future industrial revolutions,” concludes Lambert.

For more information, follow @WIP_CT (Twitter) or @Workinprogress (Facebook).

We have noted with grave concern the incidents of violence and looting in parts of Johannesburg and Pretoria in South Africa. The violence, which has also been directed at foreign owned businesses in these areas, is unacceptable and goes against South Africa’s constitutional values, and Absa’s own values.

We condemn it in the strongest terms.

Diversity is a strength that is at the heart of our business. In all our businesses we have colleagues from different African countries, something of which we are very proud. As Africans, we should be sharing goodwill that binds us together for mutual development and prosperity across our continent. We are therefore deeply disturbed that this is happening in our country, and wish to reiterate that Absa has zero tolerance for all forms of discrimination.

We appeal to everyone to spread a message of tolerance and good neighbourly relations to all their friends, family and communities.

Absa in partnership with the South African National Association for the Visual Arts (SANAVA) today announced the winners of the prestigious Absa L’Atelier competition, which celebrated its 34th year and saw rich and diverse talent emerge from across the continent.

Raji Bamidele, Nkhensani Rihlampfu, Winifrid Luena and Phoka Nyokong, were the top winners at the lavish event that took place at the Absa Dome, Cape Town, during the World Economic Forum (WEF) on Africa, which is the first time the awards have been held outside of Johannesburg.

Nigerian-based visual artist Raji Bamidele’s winning portfolio drew inspiration from the experiences that moulded him as young man and wove in differing materials and methods of contemporary and modern art forms to call into question the existence of time and being.

“My works examine the everyday innermost activities of mankind, exploring personal and political narratives, focusing mostly on the resilience of the human spirit,” he says.

South African multi-media artist Nkhensani Rihlampfu’s work aimed to expose the manipulation of communication through gesture and assumption by using fantastical figures to immerse viewers in a reality founded in perception.

“The work exists in the overlapping margin between truth and ideology; it is in this space that we each discover our identity and acknowledge the importance of communication. We are presented with familiar structures and recognisable characteristics, but never definitive facts,” he explains.

The third winner, Tanzanian visual artist Winifrid Luena’s work was a study of individuality over individualism. “There is a sense in the world at times that being an individual is a collective process – that it is part of a larger argument intended to bring some kind of human liberation, that it is an act of authority and power over the self – which is why I divide these two terms,” he says. “If individualism is a process, then individuality is a state.” His work strived to illustrate that dichotomy.

Nyokong walked away with the esteemed Absa L’Atelier Gerard Sekoto Award, which is bestowed on the most promising emerging South African artist aged 25 to 35 to enter the competition. Absa and SANAVA in partnership with the Embassy of France, IFAS and the Alliance Francaise in South Africa, introduced the award in 2004 to honour Sekoto’s legacy, which changed the narrative of how the work and lives of black South African artists is perceived, valued and documented.

Nyokong was selected as the Gerard Sekoto winner because his photography brought through the themes of gender (mis)identity, collective social anxiety and the temporality of the human material experience.

“The work, which uses the medium of studio photography to create a performative narrative, does this by imagining the human as a being whose social identity cannot be pinned down to mere rigid gender associations – a being whose socialized nature means that they may only negotiate even their most intimate emotions, particularly their fears, in the sociable structures within which they are born and bred,” he says.

Absa L’Atelier has always worked to provide the dynamic, inspiring and young visual artists from across the African continent the platform they need to explore these types of themes and contemporary issues and to bring their possibilities to life – and in its 34 years, it has built a strong legacy for achieving this.

“We believe in giving art light by nurturing the talent that we have within the continent, and we find it deeply inspiring to witness the multifaceted works that are presented year on year,” says Dr Paul Bayliss, Absa’s Senior Specialist Art Curator, Absa Art & Museum.

As a way of building on Absa L’Atelier’s legacy and to ensure that it remains at the cutting edge of the evolving art world to provide Africa’s promising up-and-coming artists with the right type of support, Absa L’Atelier introduced changes in the 34th installation of the competition where the entire adjudication process was for the first time streamlined through an online platform. The 4th Industrial Revolution signals a new era of shared prosperity, agility and driving a sustainable future, which is why the Absa L’Atelier has seen various adaptations this year.

Bamidele, Rihlampfu and Luena will become ambassadors and will get a simultaneous one-month residency in Paris, in March 2020. Partners from Cité Internationale des Arts will offer critical support by mentoring the ambassadors and connecting them to other artists. Ambassadors will then be brought back to South Africa in April 2020 for a three-month residency which will be divided into two parts, one with the University of Pretoria for one month and the other with the Nirox Foundation for two months. The residencies will aim to expose them to the Johannesburg visual art scene, as well as provide them with eight masterclasses with industry professionals that will assist them in building and managing their career. The residency will also give them time to work towards an exhibition featuring their own work and work made in collaboration with each other, which will open at the Absa Gallery in Johannesburg and then travel to their respective home countries.

“African artists contribute a unique aesthetic and cultural vision into a global arts industry. Artists remain an integral part of society’s conscious and a reservoir of cultural interpretations. This competition seeks to support the career of artists as ambassadors,” says SANAVA President, Avitha Sooful.

Nyokong, as the winner of the Gerard Sekoto award, will enjoy a three-month residency at the Cite Internationale des Arts in 2020 and a travelling exhibition through the Alliance Française network in South Africa in 2021.

“This competition, which has been supported for more than a decade by the Embassy of France, the French Institute and the Alliance Française, has created a true cultural dialogue between our two countries. Through a vibrant experience in France, and reinforced international recognition, it has allowed young artists to inspire and be inspired, to teach and learn, to explore and exhibit in a broader way,” says Ambassador of France in South Africa, Aurélien Lechevallier.

“We strongly encourage Africa’s young artists to pursue the opportunity provided by Absa L’Atelier and use the rich culture and inspiration that the continent offers to hone their craft and tell truly African stories,” concludes Dr Bayliss.

About Absa L’Atelier

The Absa L’Atelier art competition is one of Africa’s most prestigious art competitions, and 2019 sees the 34th iteration of the competition. The Absa L’Atelier art competition rewards young visual artists, aged 21 to 40, with the opportunity to develop their talents abroad. This is clearly evidenced by the previous winners and the benefits and experience they attained by participating.

Artists who are citizens and permanent residents of Botswana, Ghana, Kenya, Mauritius, Mozambique, Namibia, Nigeria, the Seychelles, South Africa, Tanzania, Uganda, and Zambia and who reside in the above countries, are eligible to participate in the Absa L’Atelier art competition and are hereby invited to enter.

The Absa L’Atelier art competition is hosted annually by Absa in partnership with the South African National Association for the Visual Arts (SANAVA). There are 12 countries that form part of the 2019 Absa L’Atelier. The 12 countries are randomly divided into three groups of four countries each. Artists within each group compete against each other. There is no competition between the three groups – artists compete within each group only. The winner of each group will be referred to as the Absa L’Atelier Ambassador.