Fitch cuts Barclays Africa, Absa Bank

Fitch Ratings said it downgraded Barclays Africa Group Ltd.’s and Absa Bank Ltd.’s foreign currency long-term issuer default ratings to BBB- from BBB and the local currency long-term issuer default ratings to BBB- from BBB+.

The downgrades follow the announcement by Barclays Africa’s parent, Barclays plc’s (A/stable) of the sale of its African operations. Barclays holds a 62.3% stake in Barclays Africa.

The downgrades reflect Fitch's view that there is a lower support propensity from Barclays for Barclays Africa and Absa given the parent's intention to sell its controlling stake in Barclays Africa (which fully owns South African domestic bank, Absa) and deconsolidate the subsidiary (from both an accounting and regulatory perspective) over two to three years.

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