The Register of Banks has granted Discovery a banking licence, putting the health and life insurance group a little closer to its goal of establishing a retail bank by 2018.

The granting of the licence to NewDisc Limited, shortly to be renamed Discovery Bank, was still subject to certain regulatory conditions, including shareholder and Competition Commission requirements, the company said in a statement.

"Discovery awaits the Competition Commission’s final response and is in the process of assessing the implications of the conditions. Shareholders will be informed of further developments and progress in the development of Discovery Bank Limited when appropriate," the statement read.

The company has said previously it would spend about R2.1bn to establish the bank, and had already begun investing in the necessary infrastructure.

Discovery had first received authorisation from the Registrar of Banks in October last year to establish a banking presence in SA. It was one of a number of companies at the time to receive such authorisation, the others including PostBank, and TYME — a local mobile payments start-up acquired by Commonwealth Bank of Australia in 2015.

At 1.10pm Discovery’s share price was up 0.26% to R143.18.

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