Aug. 5 (Bloomberg) -- Absa Group Ltd., the South African bank controlled by Barclays Plc, said costs will increase by more than inflation as spending includes an 8 billion-rand ($1.1 billion) investment in technology.
“Cost growth will outpace inflation in the short term,” Chief Executive Officer Maria Ramos said in Johannesburg today. “To drive innovation you have to have IT capacity.”
The technology spending over the next three years will include document management for mortgage applications, disaster recovery systems and improved technology for tellers, said Deputy Chief Executive Officer Louis von Zeuner.
Parts of Absa, which is committed to “streamlining” its business, may have “too many people,” said Ramos. South Africa’s third-largest bank by assets, yesterday reported a cost-to-income ratio of 53.6 percent in the first half of the year compared with 46.6 percent a year earlier.
Absa, which has operations in Mozambique and Tanzania, wants to integrate its systems with Barclays’s in Africa to catch up with rivals such as Standard Bank Group Ltd., which operates in 17 countries on the continent.
To contact the reporter on this story: Renee Bonorchis in Johannesburg at email@example.com