The South African state may soon be in a position to own a registered bank that will compete with other private banks, should the majority of Members of Parliament in the National Assembly support the Banks Amendment Bill [B 12-2018], which is currently being considered by the Portfolio Committee on Finance.

On Tuesday, the committee was briefed by one of its members, Mr Floyd Shivambu, who tabled the Bill under the Private Member’s Bill provisions.

The Banks Amendment Bill, among other things, aims to amend the Banks Act of 1990, so as to amend and insert certain definitions and enable a state-owned company to register and conduct the business of a bank, in terms of the Banks Act.

Mr Shivambu said the South African’s banking sector is currently dominated by five large banks, which 90% of the banking sector assets as at 31 December collectively held 2017.

Although the committee deliberated on the presentation, it did not take any position on whether it will support or reject the Bill going forward.

The Chairperson of the Committee, Mr Yunus Carrim, said although a Private Member’s Bill should be given attention, it did not mean that the Banks Amendment Bill should receive a preferential treatment, but the committee should aim at concluding it before the end of the fifth Parliament.

The committee was further briefed by the South African Banking Association and National Treasury, which both commented on the Bill. The Deputy Director-General of the National Treasury, Mr Ismail Momoniat, said although there are a few things that needs to be clarified, Treasury supports the Bill.

We believe that the existence of this Bill will open up the space in the banking sector for a state-owned company to be registered as a bank and compete with the private sector, said Mr Momoniat.

He further said that Treasury intends on tabling the Financial Matters Amendment Bill by the middle of October 2018.

Mr Carrim said the committee will consult with the Office of the Speaker on a way forward with regard to the Bill.

Source: Parliament of the Republic of South Africa