“Draft legislation is being prepared to allow Postbank to apply for a banking licence,” the Treasury said.
“The National Treasury and the Department of Telecommunications and Postal Services have met the Banking Registrar to trash out a Postbank structure.”
Treasury said the South African Post Office (Sapo) would meet the central bank’s requirements for the Postbank licence requirements and to finalise the transition into a commercial bank by March next year. Expenditure in the Postbank was expected to increase from R301.9million in 2016/17 to R573.2m in 2010/21.
The Treasury also said the Financial Sector Codes had been gazetted. It said that the National Economic Development and Labour Council (Nedlac) would hold a financial sector summit in April.
Finance Minister Gigaba said it was important for the codes to address transformation in the financial services industry. “Government has gazetted the Financial Sector codes and a R100billion Black Business Growth Fund has been created through the code.
“These efforts serve to extend access to South Africans who were excluded from the financial system,” Gigaba said.
The Treasury said the two twin peaks would be phased in to ensure a smooth transition to the new and tougher regulatory system by April.
Johan Ferreira, the chief legal adviser at African Unity Life, said the implementation of the twin peaks would create a more resilient and stable financial system. “This will have significant implications for the financial sector and, in particular, the insurance industry.”
“We need to make sure our industry remains safe by evolving our regulatory sphere to protect the financial stability of the country and its consumers,” Ferreira said.
The Treasury also provided a progress update on other measures it had previously outlined. It said the cabinet had approved a private sector participation framework for state-owned companies. A public procurement bill was set to be tabled to cabinet this year.
The Council for Scientific and Industrial Research has completed a study on spectrum availability and open access.
The government was also working to ensure that the public sector wage agreement did not disrupt compensation ceiling.
The Treasury said the Budget Facility on Infrastructure had received 64 large infrastructure project submissions and of these, 38 met the requirements and were being assessed. Christelle Grohmann, the director of advisory services at Grant Thornton, said it was important that significant strides were made via the Budget Facility.
- BUSINESS REPORT