Johannesburg - Finance Minister Pravin Gordhan accused banks
and financial institutions of seeking to maximise profits at all costs, The
Star reported on Wednesday.
Addressing a two-day conference on financial literacy in
Pietermaritzburg, Gordhan urged South Africans to strive towards financial
literacy so they could see when they were being hoodwinked by banks into
unsustainable financial deals and products.
Banks played a role in the 2008 financial meltdown by
offering mortgage loans to people who could not afford to repay them. South
Africa lost millions of jobs and R60bn. The country ias still trying to recover
from the crisis.
He accused Barclays Bank in London of manipulating interest
rates, "so that they could make more money for themselves and for the
"The Barclays saga of the last few days illustrates
brilliantly the fault lines in the banking sector," Gordhan said.
"It illustrates dishonesty, manipulation of prices and
information, profiteering at any cost, and little regard to the ordinary people
and the cost to them. People think they can play games and be the only ones who
Barclays, Britain' third-largest bank, has been shaken by a scandal over traders manipulating the London Interbank Offered Rate (Libor), which is used worldwide as a benchmark for prices on about $350 trillion of financial products.
Barclays, the parent company of Absa Group [JSE:ASA], on Tuesday
announced that its chief operating officer Jerry del Missier had also
quit following the resignation of CEO Bob Diamond earlier in the day and
the departure of chairperson Marcus Agius on Monday.
Barclays was fined $453m by US and British authorities, becoming the first bank to settle in an investigation that is looking at more than a dozen others including Citigroup, UBS and RBS.