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UPDATE 1-Barclays Africa profit growth slows as rising interest rates bite
July 29, 2016 / 7:01 AM / a year ago

UPDATE 1-Barclays Africa profit growth slows as rising interest rates bite

(Adds CEO comment, details)

July 29 (Reuters) - South Africa’s third biggest bank Barclays Africa Group Ltd reported a 7 percent rise in half-year profit on Friday, a slower growth rate as rising interest rates at home hit consumption and investment spending.

* Diluted headline earnings per share, South Africa’s main profit measure, increased 7 percent to 856.7 cents in the six months ended June 30 compared with a growth rate of 11 percent a year earlier.

* “In South Africa, business confidence remains weak, and the combination of weak job growth, higher inflation and rising interest rates have placed a strain on consumer finances,” Chief Executive Maria Ramos said in a conference call.

* Ramos said Barclays Plc, which owns a majority stake in Barclays Africa, exploring strategic and capital market options to reduce its shareholding in Barclays Africa.

* Declared a 2 percent higher interim dividend of 460 cents per share

* Credit impairments increased 46 percent to 5.2 billion rand ($367.06 million) resulting in a 1.29 percent credit loss ratio from 0.97 percent.

* Revenue grew 13 percent to 36.5 billion rand, as net interest income increased 14 percent and non-interest income rose 10 percent.

* Net interest margin (on average interest-bearing assets) improved to 4.97 percent from 4.7 percent. Source text for Eikon: Further company coverage: ($1 = 14.1668 rand) (Reporting by Tiisetso Motsoeneng. Editing by Jane Merriman)

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