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Zwane threatened Nedbank’s license – demonstrating why SARB’s independence matters

Former mining minister Mosebenzi Zwane threatened Nedbank’s license to trade at a meeting with the inter-ministerial committee according to News24.

Nedbank’s CEO testified before the inquiry into state capture that Zwane had told him that he found it strange that other banks had refused to meet with government, as he believed that banks receive their licence from government.

This is not in fact true – banks get their license to operate from the reserve bank.

According to TimesLIVE, Brown testified that Nedbank had started to get concerned about the Gupta family as negative media attention began to grow around them – and when Sasfin and KMPG ditched the family, those concerns spiked.

“We thought there must have been a reason for this to happen… They would have had access to more information than we had at that stage‚” said Brown.

The bank formed a sub-committee to discuss the family’s accounts – which then decided they didn’t want to take the risks involved.

Brown was also called to the ANC’s Luthuli House, where he had to explain the decision in a meeting that included then secretary general Gwede Mantashe and his deputy Jessie Duarte.

My Take

Imagine for a second if Zwane had the power to make good on his threats to Nedbank and Standard Bank, two out of our four biggest banks. The other two didn’t show up to get threatened.

Imagine the chaos as half our banking sector ended up unable to trade – how many businesses would be unable to do things like pay their staff or take payments.

It would have collapsed our economy, and we have a government so disconnected from our country that this was a threat that was seriously being made in the presence of other senior government officials.

The ANC’s leadership are so spectacularly financially illiterate that they didn’t get why effectively shutting down two of the largest banks in the country would be a bad idea.

Never mind the corruption, there is a downright frightening degree of incompetence there.

Now consider that in August the EFF introduced a bill to nationalise the reserve bank.

Correction: I previously reported that the meeting with Zwane was at Luthuli house and included Mantashe and Duarte when it was actually a totally separate meeting.

 

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