great at fixing things we broke ourselves...
One of the more bizarre
awards handed out in the banking sector is the one for Excellence in Complaints
Handling. It is dished out annually by the Ombudsman for Banking Services.
Winning a prize such as this must pose something of a marketing conundrum. After all, to win the award, you first need to have stuffed up - before you can provide exceptional service in resolving the problem.
Bank Notes has occasionally had to remind bankers that it pays to put the horse before the cart. In other words, banks first need to give excellent service, then follow it with more of the same.
Staying with Absa, a client of MLS Bank, its asset finance unit for medical and dental professionals, called to say that Absa was closing it down and retrenching staff, having earlier said it would not retrench any. he was convinced MLS was being sold to Investec for the princely sum of R600-million.
For some time I have maintained that Absa would eliminate its last branding anomaly and fold MLS into its personal financial services division, which is run by customer service fanatic Brendan O'Donnell.
MLS was probably for sale a couple of years ago, but a quick call to Investec chief executive Stephen Koseff to see if Investec had been shopping, elicited the colourful denial that only he could give. I always enjoy Koseff's down-to-earth Benoni way of dealing with enquiries that are wide of the mark.
O'Donnell says that far from selling MLS, Absa is busy integrating it into his division. That makes sense, and presumably frees up a desirable office space on Johannesburg's Oxford Road.
Expect O’Donnell to transform the unit into a more holistic business for a broader range of professional practices – not only medical, but also legal and accounting businesses – under the Absa personal finance services banner.
Still staying with Absa, we suspect the recent radio silence surrounding the Barclays bid related entirely to protracted negotiations with Sanlam over the price it wants for the portion of its 21,4% stake in Absa it plans to sell.
Apparently some institutions are miffed that Sanlam might get not only the Barclays offer price, but also extra value in the form of a firm bancassurance agreement with Barclays instead of the memorandum of understanding it currently has with Absa.
Barclays has no end of suggestions from the market on how to structure its deal. The investment bankers have had their work done for them.
Some still say Barclays should simply reverse its Africa division into Absa and take Absa scrip in exchange, but they forget that Barclays wanted about £400-million for it when they were hawking it around Johannesburg a couple of year ago, or just more than 10% of Absa’s current value. The asking price was a bit steep at the time.
Absa’s share price has never had it so good. It paused for breath this week, en route to the R75 level at which we initially reckoned the offer would be pitched.
Barclays will not be allowed to walk away on due diligence issues, but it might chisel away at the price after taking a look at some of Absa’s unhappy African and Singapore exposures.
The current price nevertheless tells us that Absa punters reckon they are in line for a generous Christmas present.