WARNING: This is Version 1 of my old archive, so Photos will NOT work and many links will NOT work. But you can find articles by searching on the Titles. There is a lot of information in this archive. Use the SEARCH BAR at the top right. Prior to December 2012; I was a pro-Christian type of Conservative. I was unaware of the mass of Jewish lies in history, especially the lies regarding WW2 and Hitler. So in here you will find pro-Jewish and pro-Israel material. I was definitely WRONG about the Boeremag and Janusz Walus. They were for real.
Original Post Date: 2010-08-02 Time: 19:00:02 Posted By: News Poster
By Sure Kamhunga
Johannesburg – ABSA Group CEO Maria Ramos may have been keen to enjoy the after-glow of celebrating the anniversary of the marriage with Barclays Bank, which bought the business five years ago.
But the celebratory mood Ms Ramos felt last week when she spoke of the success of the investment so far was spoilt on Thursday night when Absa said earnings to June would be lower than expected.
Absa said in a trading update headline earnings per share would fall by as much as 5% in the six months to June. Analysts said the update had clouded optimism that the banking sector was benefiting from the slow recovery of Africa’s largest economy.
However, earnings per share would be 10%-12% higher than the first half of last year. Absa presents its interim results on Thursday.
There have been expectations that the top four listed banks would post improved results this year after earlier trading updates indicated improvements in the wake of recent sharp falls in profits, analysts say.
“I think that it is a bit of a surprise and since they are not very clear on what is not working, we can only speculate until they release their results,” says Sanlam Investment Management analyst Patrice Rassou.
The news that headline earnings would be lower than expected was especially surprising given that a quarterly report from Barclays had implied Absa was on track to deliver solid earnings.
In the quarter to March, Barclays said profit before tax at Absa – excluding Absa Card and Absa Capital – had increased 114% to £167m.
This included a one-off credit relating to the group’s recognition of a pension fund surplus, and a boost to the bottom line by a stronger rand relative to the pound. Excluding these items, profit before tax rose 15%, driven by lower retail impairments.
Now Ms Ramos has to explain where the wheels might have come off since that update, and what her plans are to cheer shareholders in the second half of the year. “It will be interesting to see what happens when the results are out,” Mr Rassou says.
Absa said in its latest update that a warning to shareholders given when it released its annual results early this year, that economic conditions would remain tough this year, had been borne out. At the time Absa sketched a difficult and patchy economic performance this year, although the lender hoped recovery from the recession could be sustained by continued government infrastructure spending.
As it has turned out, economic conditions have been anything but rosy. High levels of consumer and corporate debt, worsening unemployment and declining factory output have been stunting prospects for growth and continue to do so, analysts say.
Despite high impairments and sluggish credit growth, some analysts still believe that Absa should have done better, considering the size of its business and the benefits it claims to have enjoyed from being part of a global lender such as Barclays.
“I am not really quite sure where the revenues have dried up. Maybe they have taken pain in some of their revenue streams,” says Mr Rassou. “On the other hand, it could be that there have been write-downs on large positions, whether private equity or property positions.”
Steve Meintjies from Imara SP Reid says that Absa’s update mirrors the difficult economic conditions in SA.
“I think it is not surprising given the recent credit (extension) data that have been released showing a small increase in lending. That is all about it,” says Mr Meintjies.
Private sector credit extension in June grew 0,9% year on year against 0,8% in May and forecasts of more than 1,1%.
Investec CEO Stephen Koseff says the economy requires more measures – such as another interest rate cut – to promote faster recovery.
“Demand for credit is picking up for the first time and we would have expected the (Reserve Bank) governor to cut rates to get things going, so people can start spending again and build factories and create employment,” he says.
Original Source: 
Original date published: 2 August 2010
Source: http://allafrica.com/stories/201008020992.html?viewall=1