'No serious slowdown for SA'

Johannesburg - FirstRand, South Africa's second-biggest banking group by assets, is adequately capitalised and has liquidity buffers in place to see out the credit crisis, its chief executive said on Tuesday.

CEO Paul Harris told Reuters the bank did not need to shore up its finances despite a global financial crisis that has felled some of the world's biggest banks and sent markets reeling.

"We certainly haven't got a programme to do anything more than what we're doing," Harris said on the sidelines of a presentation in Johannesburg on the global credit crisis.

"We've done a lot of work around ensuring that all our liquidity buffers are in place, so we're just hanging in, seeing out the crisis."

South Africa's big four banks have escaped the worst of the global financial crisis thanks to tougher exchange controls and a cautious approach to borrowing. They have all said their finances are sound.

However, Standard Bank, Absa, Nedbank and FirstRand have all reported rising bad debts at their retail units as consumers struggle to pay back loans due to higher interest rates.

Analysts say the banks will also likely be hit by slower economic growth as South Africa feels the ripple effects of a looming worldwide recession.

International ratings agency Fitch singled out FirstRand last month, downgrading its rating on the company due to a rise in non-performing loans in its vehicle financing, home loans and credit card businesses.

Harris said South African banks still had a lot of value and were well capitalised.

"I do not believe South Africa is facing as serious a slowdown as other countries," Harris said in the presentation. "Exchange controls are protecting us from the worst of this crisis."

Asked whether FirstRand might take advantage of relatively low valuations to snap up assets in other emerging markets, Harris said the company did not have a "direct focus" on acquisitions.

- Reuters