State-owned enterprises (SOEs) in SA that have had billions of rand looted through state capture should not be bailed out by the central bank even as they pose a significant fiscal risk, Reserve Bank governor Lesetja Kganyago says. “The challenge of dealing with too-big-to-fail SOEs, of combining cash injections with conditionality measures, needs to be dealt with by the elected authorities — as it has been in the latest budget from the National Treasury,” Kganyago said in an e-mailed copy of a speech on Tuesday. The Bank’s “power to say no was greatly enhanced by its independence,” he said. At least seven SOEs are “either on their knees or touching the carpet” as institutions were damaged due to state capture, public enterprises minister Pravin Gordhan said in February.

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