By Kirstin Ridley and Lawrence White

LONDON (Reuters) -Barclays has sold a 7.4% stake in South African bank Absa, it said on Thursday, raising 526 million pounds ($687 million) as it looks to bolster its capital levels.

Barclays, which said it would use the net proceeds for general corporate purposes, said the placing would raise the bank’s core capital ratio by around 10 basis points, and result in a loss on sale of 43 million pounds through the income statement.

The move comes at a time when Barclays’ capital levels are under scrutiny, after regulators earlier this month warned British lenders against gaming pension rules to bolster capital ratios.

Russia’s invasion of Ukraine has further dented confidence in European banks’ capital levels, as the resulting economic slowdown and delays in central bank rate hikes dent prospects of higher dividends.

It also marks a further step in the British bank’s exit from Africa, after it announced the sale of Absa in 2016, ending a 90-year presence on the continent.

Following the placing, Barclays will hold 63 million ordinary shares in Absa, representing around 7.4% of the company.

In an accelerated bookbuilding, the bank priced 63 million shares at 164 rand each.

Absa, which owns lenders in 10 African countries including Ghana, Kenya, Botswana and Tanzania, was formerly part of Barclays Africa Group until the British bank opted to streamline its African exposure as part of a strategy revamp led by former CEO Jes Staley.

Rival Standard Chartered earlier this month also said it was streamlining its Africa business, exiting seven countries as slower than expected economic growth in parts of the continent has hampered profits.

Barclays was the global bookrunner on its share sale and Absa, Citigroup, Banco Santander and Societe Generale were co-bookrunners.

($1 = 0.7661 pounds)

(Reporting by Kirstin Ridley and Lawrence White, editing by Sinead Cruise and Emelia Sithole-Matarise)