Ray Faure

The United Kingdom’s third biggest bank, Barclays, is remaining tight-lipped about any future plans it might have for Absa if it does acquire a controlling stake in the South African bank. Media fishing for further information on Monday were referred to a statement issued by Barclays on Thursday which stated that the process was at an early stage and was subject to due diligence.

South African banking group Absa’s share price touched an all-time high of R62,50 a share on Wednesday morning after the group issued a cautionary stating that it is in talks that might result in a controlling stake in the bank being acquired. It was speculated that Sanlam, Absa’s largest shareholder, is planning to sell its 21% stake.

Inflation pressures in the Southern African Development Community (SADC) region are expected to subside somewhat on account of sustained policy discipline and improved food-supply conditions in most parts of the subcontinent, the South African Reserve Bank says in its latest quarterly bulletin.

Despite the strike by public servants, South Africa’s inflation prospects remain good with a strong possibility of interest rates being able to remain at the current level until 2006, according to senior Absa economist John Loos. He is optimistic that the CPIX (consumer inflation less mortgage costs) target can be achieved until well into 2006.

Life assurer and financial services group Liberty’s headline earnings recovered from a low base in respect of the first six months of last year, increasing by 28,6% from 130 cents to 167,2 cents for the six months until June as a result of a favourable operational performance and better investment returns.

Nedcor is now stable but there is still much to do to restore the South African bank’s performance, Jim Sutcliffe — CEO of Nedcor’s United Kingdom-listed parent, Old Mutual — said on Tuesday. "But we can now concentrate on the future rather than the past," he added.

While real gross domestic expenditure is expected to grow by 4,5% this year, South Africa’s overall economy might fail to grow to grow faster than 2,7% this year due to a negative contribution from net exports, the Bureau for Economic Research said on Tuesday. South Africa also runs the risk of balance of payments problems.

If the special dividends that Mutual & Federal has paid out in the past five years are anything to go by, it is not difficult — as some analysts point out — to understand why London-listed South African financial services giant Old Mutual wants all of the short-term insurer.

Standard Bank is looking to raise R2-billion in Tier I capital through a proposed preference share issue. "The group is looking to raise cost-effective Tier I capital as part of its capital management programme together with providing the company with funding for strategic initiatives," Standard Bank said on Monday.

A major empowerment deal announced by Absa on Tuesday means that the banking group will meet the Financial Sector Charter target of 10% direct black ownership. Chief executive Nallie Bosman also believes the transaction places Absa on a firm footing for ongoing transformation of the group.

Standard Bank — one of South Africa’s so-called "big four" banking groups — cannot be accused of not delivering on its promises. A year ago, the bank published what it referred to as its medium-term financial objectives. On Wednesday, Standard Bank CEO Jacko Maree disclosed that all of the targets had been met.

The second phase expansion of the Mozal aluminium smelter near Maputo which is expected to provide a substantial boost to the Mozambican economy will be officially inaugurated on Wednesday.

Transtel and Eskom Enterprises, which will own the 30% state owned enterprises (SOE) stake in South Africa’s proposed second network telephone operator (SNO), say the lack of certainty and inadequacy regarding certain issues surrounding the SNO lead them to believe alternative plans should be investigated.

South Africa’s major banks were quick off the starting block to cut interest rates on Thursday afternoon after the South African Reserve Bank’s Monetary Policy Committee (MPC) announced that it was reducing the repo rate by 150 basis points from 13,5% to 12%.

The South African rand surged to multi-month best levels against most of the major currencies on Thursday, buoyed by a number of factors and stop-losses.

Banking group FirstRand (FSR) confirmed on Monday it has appointed a leading firm of attorneys, Hofmeyr, Herbstein & Gihwala Inc, to conduct an independent inquiry into recent allegations made against one of its directors, former Transport Minister
Mac Maharaj.

As the war of words hotted up between the board of investment banking group Corpcapital and former director Nic Frangos over the circumstances surrounding the latter’s resignation, Frangos said on Monday night he would give his "fullest cooperation" to any independent third-party inquiry called by shareholders.