Absa Bank Ltd.

We do not assign outlooks to national scale ratings. However, our national scale ratings on Absa Bank Ltd. would likely move in line with any rating action on South Africa. S&P Global Ratings classifies the banking sector of South Africa (foreign currency: BB-/Positive/B; local currency: BB/Positive/B) in group '6' under its Banking Industry Country Risk Assessment (BICRA). Its closest peers are Brazil, Mexico, Morocco, and Thailand. India and China, which we also consider to be major emerging national economies, are also in group 6. We use our BICRA economic risk and industry risk scores to determine a bank's anchor, the starting point in assigning an issuer credit rating. The anchor for banks operating only in South Africa is 'bb+'. We

...Absa Group Ltd.'s diversified business model supports its earnings. As one of the top four banking groups in South Africa, Absa Group Ltd. (ABG/group) benefits from its strong retail and business banking (RBB) division, as well as its wider African and growing international presence. The group's business diversification helps it to maintain revenue stability through the cycle, recording an average operating revenue growth rate of 4% per year over the past four years, slightly above the top-tier average of 3.7%. We believe the group's revenue and earnings mix will remain stable and skewed toward the RBB division going forward as it continues to drive growth. Exposures to the rest of Africa are balanced between commodity- (oil in particular) and non-commodity-driven economies, which will partly offset the risks stemming from higher interest rates and inflation....

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