Bloomberg the Company

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Follow Us

Industry Products

South African Banks Ready for Basel Changes, Moody’s Says

Don't Miss Out —
Follow us on:

May 16 (Bloomberg) -- South Africa’s banks are well-capitalized and prepared for Basel III regulations, according to Moody’s Investors Service.

The quality of the lenders’ assets remains an “issue” for Moody’s, analyst Nondas Nicolaides said in a presentation in Johannesburg today. Bad debts may rise when interest rates increase, and the bulk of non-performing loans are mortgages, he said.

Basel III international rules will come into effect over the next six years, requiring banks to hold enough capital to survive market turmoil without causing risk to the financial system. Moody’s downgraded credit ratings on South Africa’s five largest banks in February, citing “the country’s increasingly constrained public finances,” which may mean the state would find it difficult to extend support to the banking system if needed.

The growth of unsecured lending in South Africa doesn’t pose a “systemic” risk, Nicolaides said. That South Africa is monitoring unsecured lending is “positive,” he said.

To contact the reporters on this story: Andres R. Martinez in Johannesburg at amartinez28@bloomberg.net Renee Bonorchis in Johannesburg at rbonorchis@bloomberg.net

To contact the editor responsible for this story: Gordon Bell at gbell16@bloomberg.net

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.