Standard Bank’s Angola Ambitions Undeterred by Partner Detention
(Bloomberg) -- Standard Bank Group Ltd. wants to raise its stake in its Angolan unit, undeterred after an investor in the business was detained and his shares seized by authorities.
“Over the last two years we have increased our stake in our subsidiaries in Kenya and in Nigeria,” Sola David-Borha, the chief executive officer of Johannesburg-based Standard Bank’s African division, said in a video call. “If the opportunity arises in Angola as well, we will do so.”
A rule barring foreign companies from full ownership of businesses in Angola was in place when Africa’s largest lender opened its unit in the southern nation in 2010, but has since been scrapped for some industries.
Authorities seized the assets of Carlos Sao Vicente, Standard Bank’s 49% partner in the Luanda-based division, in September amid on accusations of fraud. The action is linked to moves by President Joao Lourenco to crack down on alleged graft under his predecessor’s rule.
Sao Vicente, who has been suspended as a director on the board of Standard Bank’s Angolan unit, remains in custody after prosecutors two weeks ago extended his detention period for an additional two months pending further investigations. His stake in Standard Bank was taken over by Angola’s state-asset management institute, known as IGAPE.
Angola is among the top six contributors to Standard Bank’s earnings from operations on the continent outside of South Africa. A presence in 20 sub-Saharan African countries has shielded the lender from some of the pain faced in its home market, where a moribund economy and restrictions to contain the Covid-19 pandemic bankrupted businesses and pushed up unemployment.
Standard Bank will continue to look for more business in sub-Saharan Africa, where the International Monetary Fund is forecasting economic growth of 3.2% this year, David-Borha said. This includes a bigger push into Ethiopia, where the government is opening up some sectors to private investors, and taking advantage of opportunities in Mozambique’s gas sector.
The lender has helped African sovereigns and corporates raise $2 billion in capital from the U.K. over the past two years and is confident it can bring even more governments and companies to market, she said.
While the coronavirus has delayed plans to further open intra-African trade, a continent-wide agreement will boost momentum, David-Borha said. The African Continental Free Trade Area agreement, which now has 54 members, will also benefit as trade finance moves to digital platforms, she said.
©2021 Bloomberg L.P.