The Johannesburg Stock Exchange (JSE) has carried its famous name for better than a century. Now that it is moving physically to Sandton (actually, opposite the comfortable Balalaika Hotel in leafy Sandhurst), should it retain that title? For that matter, why is it moving out of Johannesburg’s rapidly dying heart at all?
The arguments in favour of a move are all too familiar. They have everything to do with inner-city decay and security fears rather than inept local government. Many now argue that, in its role as the country’s financial centre, Johannesburg long ago moved to Sandton. And the fact is that once the JSE walks, all that will be left in the old business district will be three-and-a-half bank head offices (Absa, FNB, Standard and half Nedbank) and the mining houses.
Does the name JSE still hold water under the circumstances of its new geographical location? Many other changes are now in process, including the intended merger of the three financial markets under a single roof – the JSE itself (equities), the futures market (Safex) and the bond market (secondary gilts). Perhaps a new name might be the Joint Stock Exchanges of South Africa (my invention), which manages to retain the JSE acronym.
As I understand it, the JSE’s decision was generated as much by the Gauteng legislature’s inability to govern as anything.
Increasingly hemmed in by taxi ranks, aggressive sidewalk hawkers and villains with a growing penchant for mugging, the JSE’s governing committee issued repeated warnings to Gauteng’s Premier Mathole Motshekga, each of them to little or no avail.
Perhaps no one believed the JSE would act as decisively and swiftly. But it did and no amount of pressure is likely to change that now.
It is certainly true, for example, that directors of the Johnnic group (including Cyril Ramaphosa) were prevailed upon to withdraw their funding of the new JSE building. But if anyone thought that would pose an insuperable problem, they were sadly mistaken. (Standard stepped in smartly to fill the gap. Good business is, after all, no respecter of sentiment.)
I now understand that the JSE has received an (undisclosed) offer for the sale of its present home, 11 Diagonal Street. Members will be asked to consider the deal early next month and are widely expected to accept the offer.
This sale – and that of the famous Carlton Centre, now nearing completion and, or so it’s rumoured, for a gobsmacking, miserly R30-million – will underline the extent to which the old Johannesburg, once upon a time the commercial heart of the country, is fast becoming a memory.
Have you ever wondered why it seems to cost so much to conduct everyday financial transactions through banks? Try these statistics – gathered from my own bank – for size.
In general, the minimum service fee to hold a cheque account is R10,50 a month. Inevitably, yours will be much higher. And here’s why.
For a start, to write a cheque will cost you R2 for the first R100 and another R1,30 for every R100 thereafter to a maximum of R18,50 (which you reach on a cheque of R1269). And don’t try to deposit cash – it’ll cost you 96c for every R100 you hand over to the teller (no maximum).
If you deposit a post-dated cheque, the charge is R40. If one of your cheques or debit orders bounces, the charge for being naughty is R57.
If you use a card to make a withdrawal at your own bank’s automatic teller machine (ATM) the charge will be R2,30 to process the transaction plus an additional charge of 50c for every R100 you draw. So, the cost of withdrawing R100 will set you back nearly R3.
If you are so unfortunate as to have to draw cash from another bank’s ATM on the Saswitch system, the cost will be R2,30 plus 68c per R100 drawn plus R2,70 for the inter-bank processing fee. In this case, your change from your own R100 is about R94. If your card transaction is denied, it’ll cost you R1,15 (or R2,75 on Saswitch) even though this may not be your fault.
On the other hand, though there are costs attached to using credit cards, they do offer surprising transaction savings. For example, no charge is levied if you put cash into your card and purchases are interest free if you pay within the month. On the contrary, it is retailers who bear the brunt of the banking charges (5% of the purchase value).
So it’s no bad thing to manage your own money by making intelligent use of plastic.