SARB says poor leadership harms financial sector

Court recently fingered Reserve Bank for unlawful behaviour

- By Mpho Sibanyoni

The South African Reserve Bank (SARB) has emphasised the importance of financial institutions having a solid succession plan, arguing that this leads to stability of the sector.

This was said by SARB deputy boss Fundi Tshazibana, who is also the head of the Prudential Authority (PA), during a media briefing this week.

Tshazibana's comment follows the Pretoria High Court ruling on June 25, which found that the PA had acted unlawfully and exceeded its powers under the Banks Act 94 of 1990 on a recent matter.

The court determined that the PA improperly engaged in an informal process with the Absa Group and Absa Bank regarding the nomination of businessman Sipho Pityana as chairperson of the Absa Group and Absa Bank's board of directors.

Specifically, the PA's notification to Absa Group and Absa Bank about its objection, or potential objection, to Pityana's nomination was deemed unlawful.