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The Standard Bank building in Cape Town city centre. Picture: 123RF
The Standard Bank building in Cape Town city centre. Picture: 123RF

Last week was difficult. Standard Bank was once again publicly accused of currency manipulation, of being opposed to the SA government, and — in some quarters — even of treason.

Standard Bank has not manipulated the value of the rand. Standard Bank has not engaged in any anticompetitive or criminal conduct. Standard Bank is committed to always behaving with complete integrity.

However, in a strange and painful way last week was also a good one for those of us who care about SA’s rule of law, democracy and economic performance. Here’s why.

Under our rule of law the relevant legal and administrative processes are not thrown off course by dramatic statements and viral social media messages. The Competition Appeal Court continues to hear evidence on the alleged rand-fixing case, with one of the judges asking, in relation to Standard Bank: “What is the point of pursuing this? 

Surely, it is a huge injustice to a bank to be hauled in front of the tribunal on a cartel case where in fact there’s plausible evidence — more than plausible, incontrovertible — that it was not part of any deal?

The SA Reserve Bank continues to exercise its mandate. Relatively soon after the allegations were made in 2015, the Bank found “no evidence of malpractice or serious misconduct in the SA foreign exchange market... [and that] the foreign exchange market in SA is competitive”.

This month the Bank released a technical paper showing that convergence in rand markets is “in the main, a rational response to public information, indicating central bank credibility”, and the lack of collusion in being able to manipulate the rand. These kinds of legal and technical processes don’t make the headlines. But in the end they are what counts. In SA, rationality will prevail.

The week demonstrated the health of our democracy in general — and of our free media and social media in particular. Voices alleging illegal and unpatriotic behaviour by the banks were robustly challenged. Nobody was silenced. Nobody will be silenced.

As befits our democracy, vigorous debate continues. As an additional benefit, curious South Africans were given a comprehensive crash course in how foreign exchange markets work. It wasn’t pretty, but we all emerge with our rights reconfirmed, and better informed about these complex markets. 

This controversy also gives Standard Bank another welcome chance to explain to our fellow South Africans how we think and what we do. The first thing to emphasise is that we never hide behind legal tactics or claims of confidentiality, unless any particular matter is actually before the courts and therefore sub judice.

When we discovered in 2015 that some employees of our subsidiary in Tanzania had committed crimes, we immediately self-reported this and accepted the fines and sanctions. When we discovered some employees had opened accounts unethically (but not illegally) in SA in 2020, we were transparent while the matter was being investigated and informed all the affected parties. Our track record shows that if we had done anything illegal in the foreign exchange market we would have admitted and reported it immediately.

Valuable assets

We’re not playing for time or looking for a deal. When we say we are innocent of currency manipulation we mean it. We will not settle. Where we find that our people have engaged in wrongful conduct we will act swiftly and work with the relevant authorities. Where we find no evidence of wrongdoing we will protect and defend our people — our most valuable assets.

We put a lot of time and resources into promoting more investment and faster growth in SA. Standard Bank’s long-term performance depends on the success of the economy and on the economic wellbeing of our clients. As several cabinet ministers will be able to confirm, last month alone we were among the main sponsors and main speakers at two major conferences — SA Tomorrow and the Agoa Forum — devoted to encouraging investment in SA.

We do this by emphasising SA’s fundamental stability, strong rule of law, economic resilience, competitiveness and improving prospects — thanks in large part to structural reforms government is implementing. We’re patriots who would never undermine this country. But we won’t sit back idly either, or just toe the line. As SA’s and Africa’s largest private sector financial institution, we believe we have a right and a duty to comment on economic and financial sector policy.

When we see errors or opportunities to do better in these areas we call them out. For instance, we will continue to argue vigorously for the reforms needed to improve SA’s competitive advantages, to reduce the cost of capital, and so to accelerate growth and job creation. Right now, for instance, faster reforms to the transport sector, far wider use of public-private partnerships across the public sector, and more effective law enforcement, are top of our list. Since banks depend on trust and contracts, a strong rule of law is absolutely vital to us. 

But we will never comment outside our mandate. And we will never make a statement for, or against, any political party or individual politician. We exist to serve the economic development of SA and to help South Africans flourish. All South Africans. We don’t take sides. We stand on the side of sound universal principles that seek to advance the cause of ordinary people, the constitution and the rule of law.  

Client support 

We do everything in our power to support our clients through good times and bad. We are always looking for ways to increase the financial and economic inclusion of our fellow South Africans and Africans. Everything we do emerges from this perspective, and all our activities aim to create sustainable growth and inclusive value.

For example, over the first half of this year we kept R1.8-trillion in deposits safe for our clients, and we paid R45bn in interest on those deposits to the individuals, corporates and governments that entrusted their savings to us. We managed R1.4-trillion in assets — mostly money people are saving for their pensions, or that they are relying on in retirement. Over the first half of the year we also paid out more than R11bn to clients in annuities and for death and disability claims.

At the end of the first half of this year we held a stock of R1.4-trillion in loans. Our aim is that each loan brings people closer to realising their aspirations. For instance, we lent R22bn to small and medium enterprises across Africa to grow their businesses, and we registered R1.4bn of affordable housing loans in SA, bringing the number of clients we have provided loans to for affordable homes to more than 98,000.

Last year we spent R12.5bn with black-owned suppliers, and paid R6.5bn in tax to the SA government. Through our membership of the Banking Association and Business Unity SA we are strong supporters of the government-business collaborations on energy, logistics and tackling crime and corruption. Many of our colleagues lend their skills and time to improve the performance of SOEs and other important public entities. 

Finally, as I write this during a weekend of stage 6 load-shedding I’m pleased to say Standard Bank has so far funded nearly 4,000MWh of new electricity generation in SA. That will be equivalent to four stages of load-shedding once it all comes online. Far from undermining SA, we are literally helping to keep the lights on.

No matter what anybody says or thinks about us, that’s not going to change. As proud and committed South Africans we will always uphold our constitutional obligation to ensure our country improves the quality of life of all citizens. We will continue to seek out opportunities to work with all stakeholders to fulfil this obligation. 

• Tshabalala is Standard Bank Group CEO.

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