Big four banks’ dominance must end: Zuma
President Jacob Zuma said the dominance of the country’s four major banks must end and access to the economy for the black majority improved. By Amogelang Mbatha.
President Jacob Zuma said the dominance of the country’s four major banks must end and access to the economy for the black majority improved.
“There’s a skewed kind of economic control,” Zuma said on Friday. “We actually frustrate our economy deliberately by letting a few people control the economy. So we want to change that. Let us have more banks and share that space.”
The country’s five largest lenders, including the so-called “big four” of Standard Bank, Barclays Africa Group (Absa), FirstRand (First National Bank) and Nedbank, control about 90% of banking assets in the country.
Criticism of the lenders from Zuma and his supporters intensified after the institutions refused to do business with companies linked to the Gupta family, who are friends with the president and in business with his son.
Zuma, 74, was speaking at an event hosted by The New Age newspaper, which has ties to the Guptas.
The family, led by brothers Atul, Ajay and Rajesh, came to South Africa from India in 1993 and built a business group ranging from computers to uranium mining.
Zuma’s comments follow the state-of-the-nation address on Thursday, in which he said the inclusion of the black majority in the economy has been too slow.
The monopoly in the mining sector should also be addressed, Zuma said, while increasing land ownership for black people discriminated against during apartheid also formed part of the government’s plan to transform the economy.
“Let us not have others having the monopoly and others having nothing,” he said. “If we don’t do it as a country, we are sitting with a time bomb.”
Barclays Africa, controlled by the UK’s Barclays, was the target of the ANC Youth League on Friday. Protesters, who marched to the bank’s Johannesburg headquarters, demanded it pay back money from a bailout provided to a lender it bought before the end of apartheid.
This comes after the leaking of a draft report compiled by South Africa’s graft ombudsman that said Barclays Africa, which traded as Absa then, may have unduly benefited from state support when it bought Bankorp in 1992. — (c) 2017 Bloomberg LP
- Reported with assistance from Robert Brand and Renee Bonorchis