Cape Town - Changing the ownership structure of the SA Reserve Bank (SARB) at this point in time could raise financial and economic risk and uncertainty for the country in a policy sense, the central bank said in a statement on Thursday.
SARB regards what it deems to be such a heightened exposure to risk as unwarranted given SA's fragile economic situation.
Fin24 reported earlier that the ANC's Economic Transformation Committee has resolved that the SARB should be nationalised and the existing structure of private shareholders within the central bank be done away with.
Chair of the committee Enoch Godgonwana did not provide a timeline for this policy change to come into effect, but gave the assurance that the ANC will not change SARB's mandate.
The central bank, however, emphasised that it functions in the public interest and that private shareholders have no influence whatsoever on monetary policy, financial stability or banking regulation. SARB’s mandate is determined by the Constitution.
"Policy making and execution is the preserve of the governor and the deputy governors, who are appointed by the President. The rights of the private shareholders are highly circumscribed," explained SARB.
A shareholder and his or her associates cannot hold more than 10 000 shares out of the total of 2 million shares in issue. In terms of the SARB Act, shareholders receive a fixed annual dividend of 10c per share, making the total dividend payout each year R200 000.
"Nationalising the SARB would also be expensive as its shares currently trade for much less than the price at which some existing shareholders are willing to sell their shares," the central bank said.
In its view, the "buying-out" of existing shareholders will, therefore, result in paying large sums of money to effect "cosmetic changes that will have no bearing on the manner in which the SARB carries out its mandate or executes its policy responsibilities".
Two weeks before the ANC policy conference earlier this year resolved to have a fully state owned central bank, Public Protector Busiswe Mkhwebane recommended that the SARB's mandate be changed to focus on economic growth, instead of price stability.
She was forced to admit in August that she didn’t have the powers to recommend Constitutional changes after the SARB applied for an urgent interdict against her.
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