Absa Group saw information technology (IT)-related spend increase by 5% to R8.2 billion, in the first half of the year, according to its results released today.
This is a significant increase compared to the same period last year, when the bank reported IT spend of R3.3 billion for the six months ended 30 June.
As part of the R8.2 billion this half-year, the big-four bank spent R3.6 billion on cyber security, software licence and maintenance costs during the six months to June − an increase of 7%.
According to Absa, total IT spend was 27% of all its operating expenses, and is the reason day-to-day operating costs, excluding staff-related expenses such as inflationary increases, rose 5% to R12.8 billion.
“Ongoing investments in new technologies, the use of AI [artificial intelligence] and digitisation are expected to yield benefits through operational streamlining and automation, which will further enhance delivery on client-centric solutions.”
Absa explains that it established a policy to embed responsible AI use and align with ethical and regulatory expectations during the six months under review.
In addition to South Africa, Absa operates in 11 other African markets: Botswana, Ghana, Kenya, Mauritius, Mozambique, Namibia, Nigeria, Seychelles, Tanzania, Uganda and Zambia.
For the period, Absa Group’s customer base increased 2% to 12.8 million in the first half of the year and group-wide digitally-active customers increased 8% to 5 million customers.
Last November, group CIO Johnson Idesoh revealed to ITWeb TV that 4.6 million customers were digitally-active − a figure said to be growing about 12% annually.
According to the bank, evolving its product offering and digital channels saw the launch of the Kiganjani app in Tanzania, to make it easier for customers to manage their finances from anywhere.
Absa also notes it is investing in digital capabilities in its newly-formed Personal and Private Banking (PPB) business.
In PPB, the bank says it aims to deliver a seamless, human-centred banking experience for customers. Its areas of focus include enhancing mobile and digital platforms, embedding AI and data analytics, and strengthening cyber security.
Absa’s results booklet shows its operating expenses in the PPB unit gained “5% to R11.7 billion on continued investment in digital capabilities and technology”. PPB’s total operating expenses, excluding staff, accounts for 92% of all its day-to-day expenses.
“Our ambition is to be a leading Pan-African bank that creates value by enabling inclusive growth, building financial resilience and driving sustainable development across the continent,” it says.
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