Gordhan's banks parley 'a milestone'

Johannesburg - The Competition Commission said on Monday that Finance Minister Pravin Gordhan's meeting with the CEOs and chairpersons of banks, set for Monday evening, was a "milestone".

The meeting in Pretoria was initially scheduled for Monday afternoon. Gordhan will provide details of the meeting to the press on Tuesday, according to the National Treasury.

Issues to be discussed include recommendations of the Banking Enquiry Panel of the Competition Commission, international developments on financial regulatory reform, remuneration practices and incentive structures in banks, credit extension trends and financial access and transformation.

The Banking Enquiry, established by the Commission in 2006, found among others that the country's bank charges were among the highest in the world. These include ATM charges and amounts charged for processing rejected debit orders.

"It's certainly a milestone and a lot of thought and work went into the post-inquiry period to arrive at this point," Competition Commissioner Shan Ramburuth told newswire service I-Net Bridge in an interview.

The Banking Association of South Africa (Basa) told I-Net Bridge earlier that it had already started implementing some of the recommendations. "We are reacting proactively to those recommendations," it said.  

"Some of the banks have reduced their penalty fees. We are also starting a programme to look at how customers can more reliably stop debit orders so we can stop debit order abuse," said Steward Grobler, Basa senior GM.

However, he highlighted that others would be much harder to implement in the short term.  

"For instance, changing the pricing model for ATMs. That's something that needs to be well thought of [sic] especially following the financial crisis and the attention that was brought on banks and their sustainability," he said.

 - Fin24.com