Barclays Share News (BARC)

* Reports profit up 3.9 pct and net interest income up 1 pct

* Credit impairments shrink by 20 pct

* Considering expansion to Nigeria

* Name to revert back to Absa Group(Recasts, adds finance director comments)

By Ed Stoddard

March 1 (Reuters) - Barclays Africa Group, SouthAfrica's No.2 lender by market value, plans to extend its reachthroughout the continent, it said on Thursday after postingannual profit up nearly 4 percent.

Chief Executive Maria Ramos said the bank, which is changingits name back to South African brand Absa after its split fromformer parent Barclays, aims to enter Nigeria as itseeks to lift its share of the African market to 12 percent from6 percent over the medium term.

Finance Director Jason Quinn told Reuters that Nigeria hasbeen in its sights for some time.

"We would have to think carefully about how and when toenter the Nigerian market and that is what we are going to startdoing," he said.

"We have to decide how we enter, whether we acquire orbuild."

The bank had earlier reported normalised diluted headlineearnings per share -- the primary measure of profit in SouthAfrica, stripping out one-off items -- up 3.9 pct at 1,837.7cents for the year to Dec. 31, helped by a 20 percent drop incredit impairments.

Net interest income, a gauge of lending profitability, roseby 1 percent to 42.32 billion rand ($3.56 billion), while itsnet interest margin was unchanged at 4.95 percent.

Growth in the United States was the positive surprise in thesecond half, even as Europe, Japan and China grew at or aboveconsensus expectations, the bank said.

This more than made up for slow economic expansion in itsmain markets, which account for about 80 percent of groupincome.

Barclays Africa and its rivals have struggled to increaselending as slowing economic growth in many African marketstempers demand from corporate clients while retail clients inits home South African market feel the squeeze from risinginterest rates.

However, confidence in its domestic market has been buoyedby the Cyril Ramaphosa's elevation to the South Africanpresidency last month, pledging to revitalise the economy.

Barclays Africa said it expects growth in loans and depositsto improve in 2018 and forecast stronger loan growth from therest of Africa. It also forecast stronger loan growth incorporate and investment banking in South Africa.($1 = 11.9025 rand)

(Additional reporting by Tiisetso Motsoeneng in Johannesburgand Esha Vaish in BengaluruEditing by Stephen Coates and David Goodman)