Banks Must Answer to Parliament

FACT-FINDING: LENDING PRACTICES TO COME UNDER FINANCIAL COMMITTEES' SPOTLIGHT

- Ina Opperman

The major banks have been called to parliament to answer questions about their credit lending practices as part of a fact-finding mission that will include determining why banks are keen to extend credit for consumption, but not so much for production.

A statement issued by parliament said the portfolio committee on trade, industry and competition, as well as the standing committee on finance, will meet the major banks in February to understand their credit lending practices for production and consumption purposes, as well as their progress in contributing to transformation of the economy.

Mzwandile Masina, chairperson of the portfolio committee on trade, industry and competition, said the meeting will be a fact-finding mission based on two committees' observations after they met with the National Credit Regulator (NCR), National Treasury and the Competition Commission late last year.

So far, the Banking Association of South Africa, as well as the major banks including Absa, Capitec, FNB, Investec, Nedbank and Standard Bank, confirmed that they will attend the meeting.

According to Masina, this engagement forms part of enhanced oversight over the financial sector and the developmental role they should fulfil in South Africa.