Eighteen months after resigning in the aftermath of the Libor rate-rigging scandal, Bob Diamond is plotting his comeback. This week, the former Barclays chief executive raised $325m from investors. He is now looking for an African financial services acquisition on which to spend the cash.
Yet if this fallen titan has not after all been condemned to the underworld, he appears at first sight to be heading for a relative backwater. Banking services are poorly developed in Africa. About 60 per cent of Kenyan adults are without a bank account, for example, compared to just 3 per cent in the UK.
Banks concentrate on serving parts of Africa that are home to most of its wealth but few of its people. Much of the continent is too poor to sustain costly branches and infrastructure. Dysfunctional institutions can also be a hindrance, although these have been improving lately. Property registration costs are falling, and 70 per cent of African countries now have a national system of credit records. But enforcing contracts remains difficult; legal fees amount to roughly half of the average claim.