The Banking Association SA (Basa) has expressed concern that the proposal by the EFF to create a state-owned bank could engender systemic risk for the banking sector if such a bank were to capture the accounts of public servants. The association also flagged political interference in the bank as a danger, in a presentation during public hearings on the bill by parliament’s finance committee on Tuesday. EFF chief whip Floyd Shivambu has tabled a private member’s bill to amend the Banks Act to allow for the establishment of a state-owned bank. Currently the act permits only public companies to own banks and does not explicitly permit the state to own banks. He said that an example of a state-owned bank could be a public service bank that could provide banking services to public servants across all spheres of government. Another example would be the Postbank. In a written presentation to the committee, Basa said it supported the creation of all new banks provided they were subject to t...

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