ON THE MONEY: Far worse than ratings downgrade would be getting booted from banking body
A downgrade on the Financial Action Task Force because of Fica will hammer SA’s banking system, writes Stuart Theobald
If you think a ratings downgrade would be bad for SA, consider what a downgrade of its status on the Financial Action Task Force would look like. Currently, a member in good standing, it could find itself on the "grey list" of countries with poor anti-money laundering regulations. That would put the whole world on notice that SA’s financial system cannot be trusted to prevent crime. The banking system’s access to foreign currency would be threatened, as international banks would refuse to clear dollar transfers to SA. Banks’ access to lines of credit from international banks, which are essential to facilitate transactions for SA businesses, would be put at risk. International payments operators such as Visa and Mastercard would refuse to partner with South African banks. Global institutions would refuse to lend to the South African government or businesses. Yet that is a prospect that certain members of South African society are willing to accept. Mzwanele (Jimmy) Manyi and Danisa B...
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