Aug. 23 (Bloomberg) -- South Africa remains “vigilant” on maintaining financial stability to keep the country’s banking industry stable and well capitalized in the face of global uncertainty, Finance Minister Pravin Gordhan said.
Lenders still need to cut fees, improve access to credit and implement international principles on executive compensation, Gordhan told a conference in Johannesburg today. About 63 percent of the adult population has a bank account, a figure the industry wants to increase to 70 percent.
“There is a perception that the financial sector isn’t doing enough to support the real economy,” he said.
South African banks and regulators should be congratulated for the lenders’ positive performance at a time when the global economy is in turmoil, with the Stoxx Europe 600 Index having lost 17 percent this year in the wake of uncertainty about debt defaults in Europe and growth in the U.S. South Africa’s six- member FTSE/JSE Africa Banks Index has dropped 6.2 percent this year, reaching lows not seen since June last year.
Cas Coovadia, head of the country’s Banking Association, said it was unlikely the government would heed a call by the ruling African National Congress’s youth wing to nationalize banks.
“I don’t think nationalization will happen in South Africa,” Coovadia said at the conference. Gordhan didn’t comment on the issue.
By Renee Bonorchis
Source: www.businessweek.com
Lenders still need to cut fees, improve access to credit and implement international principles on executive compensation, Gordhan told a conference in Johannesburg today. About 63 percent of the adult population has a bank account, a figure the industry wants to increase to 70 percent.
“There is a perception that the financial sector isn’t doing enough to support the real economy,” he said.
South African banks and regulators should be congratulated for the lenders’ positive performance at a time when the global economy is in turmoil, with the Stoxx Europe 600 Index having lost 17 percent this year in the wake of uncertainty about debt defaults in Europe and growth in the U.S. South Africa’s six- member FTSE/JSE Africa Banks Index has dropped 6.2 percent this year, reaching lows not seen since June last year.
Cas Coovadia, head of the country’s Banking Association, said it was unlikely the government would heed a call by the ruling African National Congress’s youth wing to nationalize banks.
“I don’t think nationalization will happen in South Africa,” Coovadia said at the conference. Gordhan didn’t comment on the issue.
By Renee Bonorchis
Source: www.businessweek.com
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