Mboweni to EFF: Treasury has no evidence of rand manipulation by banks | Fin24
  • Load Shedding Schedules

    Find information for Johannesburg, Durban, Cape Town and other cities.

  • Another Rescue?

    Edcon | Is there appetite from creditors to extend another helping hand?

  • Tough Times

    SA restaurants face job cuts and possible closures as lockdown continues.


Mboweni to EFF: Treasury has no evidence of rand manipulation by banks

Aug 09 2019 11:27
Khulekani Magubane, Fin24

Minister of Finance Tito Mboweni has told Members of Parliament belonging to the Economic Freedom Fighters that neither National Treasury nor the South African Reserve Bank had evidence of currency manipulation by South Africa’s banks and, therefore, did not investigate it.

Mboweni was giving a written response to questions from MPs. EFF MP Sibongile Khawula had asked in a written question whether National Treasury investigated "the impact of the manipulation of the rand by various banks" and what the findings of such an investigation were.

The EFF have intensified their criticism of former Absa Bank boss Maria Ramos, accusing her of "manipulating the rand". Absa recently issued a statement reiterating that two employees had been implicated and that disciplinary action had been taken against them internally. In 2017, Bloomberg, quoting Ramos, reported that Barclays had tipped off authorities after suspending the two traders allegedly involved. 

According to a 2017 affidavit filed by the Competition Commission’s cartel division, those implicated used Bloomberg chatrooms to enter into arrangements to fix prices of the USD/ZAR exchange and divide the market by allocating customers. The matter was referred to the Competition Tribunal, which will determine, among other things, if banks conspired to collude with the currency, or if rogue traders were behind the incident.

Khawula's question, however, implied that Absa and other banks had in fact manipulated the Rand.

Mboweni's reply said Treasury and the central bank had no evidence that any bank participated in currency manipulation.

"No, the National Treasury has not investigated such impact, as neither the National Treasury nor the South African Reserve Bank have any evidence that any bank has taken part in currency manipulation," said Mboweni.

Mboweni said he was of the view that the Competition Commission investigated a case of price fixing and market allocation in the trading of foreign currency pairs involving the Rand and that this was referred to the Competition Tribunal.

"The currency market is a deep and liquid market, and it is difficult to determine any material or long-lasting impact of any one transaction on the level or value of the currency.  

"It is important for members to differentiate between the impact of any transaction on consumers and the impact on the value of the rand – the investigation before the Competition Commission appears to be related more to the conduct of bank traders towards clients, rather than providing evidence of their affecting the actual value of the rand," Mboweni said. 

Mboweni urged MPs to wait for the outcome of the Competition Commission’s investigation and invited Khawula to provide any other evidence on any currency manipulation to the Competition Commission or National Treasury.



Company Snapshot

Voting Booth

Do you support a reduction in the public sector wage bill?

Previous results · Suggest a vote