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Investors punish ABSA parent Barclays Africa over Hodnett's exit

May 15 2018 15:12

ABSA Bank’s parent company, Barclays Africa Group, announced the resignation of deputy chief executive and director David Hodnett with immediate effect on Tuesday.

The market did not react favourably to the news of Hodnett’s departure. Barclays Africa's share price slipped 2.69% to R176.13 at 14:40 on the JSE. The shares hit an intra-day low of R174.01.

In a note to shareholders, the bank said Hodnett would participate in a handover until August 31, and thanked him for his “extensive contribution”.

The 48-year-old Hodnett, a chartered accountant who completed his articles with KPMG, received R26.5m in salary and bonuses last year, according to the group's annual report.

He has been with ABSA for a decade in the positions of chief risk officer, financial director and, since August 2016, as head of the South Africa Banking portfolio.

Fin24's sister publication, Business Insider, reports his resignation could be over a disagreement on strategic direction.

Barclays Africa Group [JSE:BGA], in April announced a new structure, with four core businesses, as part of the bank's long-term vision to chart its own path after separating from its United Kingdom parent company.

The initial announcement stated that Hodnett would take a two-month sabbatical, and the CEOs of the four operations would report directly to group CEO Maria Ramos. This would essentially have meant that Hodnett’s role as head of SA banking would fall away.

No further details were provided on his post-sabbatical future at the time.

Barclays Africa announced in March it would change its name back to ABSA Group as part of its separation from the UK parent company.

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