Acts & Regulations

Last Updated 29 November 2011 12:54:43 PM

  1. Acts & Regulations

    The Banking Sector is governed by The Banks Act, 1990, and Regulations thereto.
    To provide for the regulation and supervision of the business of public companies taking deposits from the public; and to provide for matters connected therewith. 
  1. National Credit Act (NCA)

    The NCA was introduced to facilitate new and protective rights for consumers for all types of credit agreements, ranging from micro loans to home loans, and from overdrafts to retail financing. It serves as a measure that allows consumers to make more informed decisions before buying goods and services on credit. In addition, it places greater responsibility on credit providers to refuse to give you credit if you cannot afford it and, for the first time in this country, it has regulated the way credit bureaus conduct business. Read more in the July issue of Accountancy South Africa… article - National Credit Act : Unpacked
  1. South African Reserve Bank

    The Reserve Bank is responsible for bank regulation and supervision in South Africa. The purpose is to achieve a sound, efficient banking system in the interest of the depositors of banks and the economy as a whole. This function is performed by issuing banking licences to banking institutions, and monitoring their activities in terms of either the Banks Act, 1990 (Act No. 94 of 1990), or the Mutual Banks Act, 1993 (Act No. 124 of 1993).

South African Reserve Bank : Bank supervision

  1. Basel Capital Accord

    On 26 June 2004, the Basel Committee issued the publication titled International Convergence of Capital Measurement and Capital Standards: A Revised framework, commonly referred to as 'Basel II'. It represents the culmination of more than five years' work by the Basel Committee.

    Basel II seeks to set significantly more risk-sensitive capital requirements (in respect of operational risk as well) and is aimed at greater international convergence through capital requirements and better disclosure, thus enhancing the role of market discipline; and to ensure improved supervisory processes and procedures.

    The Basel II framework is available at the following link: Basel II framework 
    The Basel II framework has been subject to continuous refinement, resulting in what is commonly referrred to as Basel III.

    Basel III is a comprehensive set of reform measures, developed by the Basel Committee on Banking Supervision, to strengthen the regulation, supervision and risk management of the banking sector. These measures aim to:

    • improve the banking sector's ability to absorb shocks arising from financial and economic stress, whatever the source
    • improve risk management and governance
    • strengthen banks' transparency and disclosures.

     The reforms target:

    • bank-level, or micro-prudential, regulation, which will help raise the resilience of individual banking institutions to periods of stress.
    • macroprudential, system wide risks that can build up across the banking sector as well as the procyclical amplification of these risks over time. 

    The compilation of document that form Basel III is available at the following link: Basel III 

  2. Core Principles for effective Banking Supervision

    The Core Principles for Effective Banking Supervision, developed by the Basel Committee on Banking Supervision (the Committee) in cooperation with fellow supervisors, have become de facto the standard for sound prudential regulation and supervision of banks. The Core Principles are mainly intended to help countries assess the quality of their systems and to provide input into their reform agenda.

    An assessment of the current situation of a country's compliance with the Principles can be considered a useful tool in a country's implementation of an effective system of banking supervision.

    The Core Principles are available from additional information.

    South Africa's compliance with the Core Principles were assessed by the IMF/World Bank during December 2010 and their report is available from additional information.

    Further information on investment and prudential regulatory announcements in 2011 MTBPS (100Kb PDF)

  3. Banking Council

    The Banking Association South Africa has its genesis in the Council of South African Banks (COSAB). Four separate associations addressing specific areas of activity in the banking sector were merged into COSAB in March 1992. These associations were:
    • The Association of Mortgage Lenders.
    • Merchant Bankers Association.
    • Clearing Bankers Association.
    • Association of General Banks.

    COSAB was a committee-driven structure and was deemed to be inappropriate to address the dynamic issues prevalent in the sector. The leadership of the sector decided to establish The Banking Council South Africa in March 1998 under the stewardship of R.S.K. (Bob) Tucker. The Banking Council South Africa was an executive driven body that was structured to address the challenges in the sector.

    The Board of The Banking Council South Africa decided on 7 March 2005 to change the name of the body to The Banking Association South Africa because this was a more appropriate description of the structure of the body and its role.

    Mr. Cassim (Cas) Coovadia was appointed Managing Director of The Banking Association South Africa.

    The Role of the Banking Association South Africa

    The Banking Association South Africa is an industry body representing all registered banks in South Africa. These include both South African and international banks. The Main Board of the Association comprises the Chief Executives of the five largest South African banks, two Chief Executives representing international banks and two Chief Executives representing the other South African banks. The Banking Association has also established an Operating Board that meets once a month to provide strategic guidance and direction on the myriad of issues addressed by The Banking Association. The Operating Board is structured similarly to the Main Board, but representation is through the heads of retail of the institutions.

    The Banking Association South Africa is the mandated representative of the sector and addresses industry issues through:
    • Lobbying
    • Policy influence
    • Guiding transformation in the sector
    • Acting as a catalyst for constructive and sustainable change in the sector
    • Research and development
    • Engagement with critical stakeholders

    The broad role of The Banking Association is to "establish and maintain the best possible platform on which banks can do responsible, competitive and profitable banking". A critical role of The Banking Association is to work with its members to enable this role within the context of the transformation challenges our country is addressing.

    The Banking Association South Africa manages numerous committees that advise the executive on issues pertinent to the sector. Such committees include:
    • Access
    • Basel II
    • Preferential procurement
    • Small, medium enterprise finance
    • Agriculture
    • Housing

    Banking Council

    Banks Amendment Bill, 2010

    Memorandum on the objects of the Banks Amendment Bill, 2010 (Draft 4)