• Labour Wrap

    Terry Bell says the labour movement in SA is currently in a state of confusion.

  • Will the NPA stand up?

    Solly Moeng wonders if the NPA head will reinstate criminal charges against president Zuma.

  • Commodity currency

    Jac Laubscher asks if the true exchange rate of the rand is really a cue from commodity prices.

All data is delayed
Loading...
See More

Trouble ahead for SA banks, warns Moody's

Dec 05 2012 11:55
AFP
Johannesburg - Moody's ratings agency, on Wednesday, warned South Africa's banks that weak economic growth in tandem with their exposure to government securities poses a risk of serious trouble ahead.

Describing the operating environment for South Africa's banks as "challenging", Moody's forecast modest economic growth of 3% next year.

That, the agency said, was below the pace needed to kick-start manufacturing, "tackle high unemployment and substantially improve living standards," putting a dampener on banks' business and eroding the quality of assets.

Moody's warned that banks were over-exposed to government securities, which were recently downgraded and which make up more than 150% of capital at the largest banks.

Downgrading the outlook for the banking system to "negative" Moody's also warned that banks were over reliant on deposits from other institutions to maintain liquidity.
   
 

 

Follow Fin24 on Twitter, Facebook, Google+ and Pinterest.

moody's  |  banks

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
13 comments
Comments have been closed for this article.
 

Company Snapshot

We're talking about:

SMALL BUSINESS

Marketing is a big concern in SA's small business community, followed by a lack of confidence and partnering with the wrong people, according to a survey.
 

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

The drop in inflation:

Previous results · Suggest a vote

Loading...