THE quality of black participation in the banking sector was important in order to manage the transformation process and align the sector with the laws of the country.
This was highlighted at a breakfast debate in Sandton yesterday where the country’s financial sector came under attack for showing little commitment to its own transformation policy. The financial sector charter was described as flawed and voluntary and in need of revision.
Vice-chairman of the Nedbank Group Lot Ndlovu said there was a need to align the sector with the country’s transformation laws.
Ndlovu said the charter was flawed from the beginning because some institutions were not showing commitment to the transformation processes.
“Transformation is an introduction of new orders, it should be sustainable and manageable,” he said. “I am concerned about the quality of black participation around the issue of transformation. Ownership by black people (within the financial sector) is an issue that was never addressed properly before. Without ownership, you cannot change the structure of the companies”, he said.
Ismail Momoniat, deputy director-general of tax and financial sector policy at the Treasury, said the charter was holding to account players that were opposed to the transformation of banks. He agreed there was a need to transform the whole financial sector to allow poor people to have shares in the industry. “It is not correct to say the charter is not aligned. It is our job to protect the sector through regulations,” he said.
The Association of Savings and Investment SA said there has been significant transformation within the sector, but there was room for more innovation.
Its GM Charmaine Soobramoney denied there were flaws in the charter, saying that people focused on negative aspects of the industry. “We cannot have every black person owning banks. It (transformation) is not always about ownership,” she said.