StanChart to acquire custody business of Absa Bank

It will also manage its trustee business.

In a release, Standard Chartered announced that it will acquire the South African custody and trustee business of Absa Bank.

This acquisition builds on the significant investment Standard Chartered has already made in its African franchise. In addition to substantial organic investment, the Group acquired First Africa (a leading African M&A advisory business) in 2009 and Barclays’ Africa custody business in 2010. Last week, the Bank announced the opening of two new wholesale banking corporate offices in South Africa, in Cape Town and Durban.

Custody is a core capability that allows Wholesale Banking to deepen its core bank relationships with clients, while also generating sustainable income and liquidity in a capital efficient manner. This transaction will help achieve a step change in the Group’s custody capability across Africa. Over the past two years the Group has developed a profitable custody model across 21 sub-Saharan African countries, launching custody operations in South Africa earlier this year. This acquisition will position Standard Chartered as a leading South Africa custodian.

Diana Layfield, CEO, Africa region said “Africa is an important strategic opportunity for the bank and for our clients, offering excellent economic growth and increasingly strong trade links with markets in Asia and the Middle East. This deal will improve the range of services we offer to clients in the region. It builds our capabilities and is in line with our strategy to support our organic growth with selective acquisitions.”