Zuma v Pravin – owners of SA’s Big Four banks down R100bn in two weeks | Fin24
 
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Zuma v Pravin – owners of SA’s Big Four banks down R100bn in two weeks

Sep 02 2016 07:27
Alec Hogg
Media personality Stephen Grootes, former DA leade

Media personality Stephen Grootes, former DA leader Tony Leon and political economy analyst Ralph Mathekga at a local elections round table discussion in Cape Town. (Paul Herman, News24)

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SA's big four banks lost R127bn in two days when former Finance minister Nhlanhla Nene was fired. In the last 2 weeks since Finance Minister Pravin Gordhan's Hawks' woes, they lost R100bn. Is anybody listening now, asks Alec Hogg.

In a report published on Tuesday, independent financial analyst Mark Ingham suggested the day the Hawks started gunning for Finance Minister Pravin Gordhan, 23/8, was turning into a “mini 9/12” – the day Nenegate began.

The numbers show it’s not that “mini” anymore. In the last two weeks, share prices of SA’s big four banks are all down double digits in percentage terms. As a result, FirstRand, Standard, Barclays Africa and Nedbank are worth a staggering R100bn less than a fortnight back.

After Gordhan’s predecessor Nhlanhla Nene was fired on December 9th last year, the market value of these four companies dropped R127bn in two days. That, together with surging bond rates and a plunging Rand, was enough to force President Jacob Zuma to atone and reappoint the Finmin he’d demoted two years earlier.

In a developing country like SA, big banking stocks are excellent barometers of investor confidence. The current selloff might have taken longer than Nenegate, but it sends the same message.

Capital is cowardly. It heads for the exit when feeling unsafe. This time it has been walking rather than running. But is leaving all the same.

Is anybody listening?

READ: Will the real Cyril Ramaphosa please stand up


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