Barclays Bank of Kenya #ticker:BBK has defended the choice of KPMG Kenya as its external auditor weeks after its mother company Barclays Africa Group Ltd (BAGL) ceased to engage KPMG South Africa over integrity concerns.
Friday, Barclays Bank of Kenya (BBK) shareholders approved KPMG Kenya as the lender’s external auditor for the second year.
The shareholders of the Nairobi Securities Exchange (NSE) listed tier-one bank voted in support of the proposed auditors during the bank’s 50th annual general meeting held in Nairobi.
Barclays management said there was no contradiction since the partnership in Kenya is a separate entity – “completely separate legal entity” -from the partnership in South Africa.
“The issues pertaining one entity, which is South African entity cannot be attributed to another entity. For that reason, we know, we as a Kenyan company are comfortable with the practice and partnership that exist here locally and that’s why we have proceeded with approving them as our auditors,” said BBK marketing and corporate relations director Caroline Ndung’u.
BBK’s parent company BAGL a few weeks ago said that it had dropped KPMG South Africa as its auditors following a controversy over its work for the infamous Gupta family, which has faced a barrage of allegations linked to state graft.
BAGL is listed on the Johannesburg Stock Exchange and is one of Africa’s largest diversified financial services group.
Change of name
Barclays Kenya management said it was able to separate the two companies and there is no overlap in how they do business.
The shareholders also approved the bank’s planned change of name to Absa over the next two years.
“The approval by our shareholders marks a key milestone in our separation from Barclays PLC and our transition into an independent African bank with a global reach.
At Barclays Kenya, it is an exciting opportunity for us to build on our legacy and create a truly Kenyan business with renewed commitment to bring possibilities to life,” said BBK chairman Charles Muchene.
The approval by BBK’s shareholders came just a week after shareholders of the parent company – BAGL gave the go-ahead for the group to change its name from Barclays Africa to Absa Group in July.
Following this approval, Barclays Kenya has until June 2020 to unveil its new brand in the market, subject to regulatory approval.
This is in line with separation agreement between Barclays PLC and BAGL, which allows the use of Barclays brand in the market until 2020.
But even before the 2020 deadline reaches the Kenyan lender is already facing legal hurdles in its bid to adopt the name of its South African parent company.
Last month a petitioner rushed to court to block Barclays Kenya from using the name, saying it had already registered a company as Absa Group.
As of June 2017, Barclays PLC was a minority shareholder in BAGL.
“This process will be managed and will align with all shareholder and regulatory requirements to ensure it is a seamless transition for all our stakeholders.
‘‘Our new identity will bring with it a heightened level of customer –obsession, a determination to be more digitally-led and take advantage of the opportunities that this market present,” said BBK managing director Jeremy Awori.
The tier-one lender, will also be putting in place virtue banking, expanding its agency, Internet and mobile banking as well as open new branches to serve new customers as and when is appropriate.