Absa scraps dividend as earnings plunge in first half of 2020

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Absa's earnings plunged in the first half of 2020 due to the impact of the Covid-19 pandemic on South Africa's economy. 

The group did not declare an ordinary interim dividend, citing guidance from the Prudential Authority of the SA Reserve Bank and the need to preserve capital. 

In an earnings report on Monday, the banking group said headline earnings declined 93% to R559 million from R7 650 million in the previous period, while diluted headline earnings per share fell 93% to 67.7 cents from 920 cents.

On a normalised basis, which adjusts for the consequences of the group's separation from Barclays, headline earnings per share fell fell 82% to 173.4 cents from 975.8 cents. 

"Even as August data show a clear slowing of the spread of the virus in most parts of South Africa, the group expects a continued difficult environment for the consumer, while heightened uncertainty will continue to dampen business confidence and investment," it said. 

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