Zuma curse stalks SA banks as bond sales set to stall

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President Jacob Zuma.
President Jacob Zuma.

Johannesburg - Just as things were starting to look up for South African banks with economic growth and lending poised to rebound, President Jacob Zuma struck.

The fallout from a midnight cabinet purge by Zuma on March 31 threatens to stall debt sales by financial services companies, which had risen to a record on a quarterly basis in the first three months of the year, according to data compiled by Bloomberg.

“In this time of uncertainty, growth is going to be constrained and bank issuance will probably be lower than in previous years,” said Rashaad Tayob, who oversees about R13.5bn as a portfolio manager at Abax Investments in Cape Town. “If they don’t see credit growth then they won’t need to raise funding.”

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