Progress on the Financial Sector Charter scorecard in the South African banking sector
- Authors: Matlabe, Aubrey
- Date: 2010-10-25T06:32:35Z
- Subjects: Banks and banking , Financial institutions , Financial Sector Charter
- Type: Thesis
- Identifier: uj:6937 , http://hdl.handle.net/10210/3447
- Description: M.Comm. , The Financial Sector Charter is a transformation charter in terms of the Broad-based Black Economic Empowerment (BBBEE) Act (Act 53 of 2003). The Charter is a voluntary initiative by the financial sector to address racially based income and social inequalities in South Africa. It aims to encourage black economic participation through its six pillars. The Charter came into effect in January 2004 as a result of the Financial Sector Summit hosted by the National Economic Development and Labour Council (NEDLAC), the multilateral social dialogue forum on social, economic and labour policy. The Nedlac partners – government, business, labour and community constituencies – negotiated the Financial Sector Summit Agreements on transforming the financial sector and signed the Summit declaration on 20 August 2002. The Charter commits its participants to 'actively promoting a transformed, vibrant, and globally competitive financial sector that reflects the demographics of South Africa, and contributes to the establishment of an equitable society by effectively providing accessible financial services to black people and by directing investment into targeted sectors of the economy. Financial institutions affected by the Charter include banks, long-term insurers, shortterm insurers, re-insurers, collective investment schemes, investment managers, retirement funds, and licensed exchanges. Any other institution in the financial sector may opt to participate in the Charter. The objectives of the Charter are to: • constitute a framework and establish the principles upon which BEE will be implemented in the financial sector; • provide the basis for the sector’s engagement with other stakeholders; • establish targets and unquantified responsibilities in respect of each principle; • outline processes for implementing the charter and mechanisms to monitor and report on progress. Progress on the Financial Sector Charter Scorecard in the South African Banking Sector In pursuit of these objectives, the Charter commits financial institutions in the sector to transforming in the areas of: • Human resource development; • Procurement of goods and services; • Access to financial services; • Empowerment financing; • Ownership and control; • Corporate social investment. The study provides an overview on the above objectives of the Charter and seeks to measure and assesses in detail the progress of the banking sector regarding the six key areas of the FSC as outlined in the FSC Scorecard against the set targets of 2008. The scorecards analysed would be those that have been submitted to the Council as at the 31 December 2006. • Amalgamated Banks of South Africa (Absa Group); • FirstRand Group (including First National Bank); • Nedbank Group; • Standard Bank Group. The study will assess the performance of each bank, highlighting the positives and providing recommendations where there are shortfalls. The results will be consolidated to give an overall performance overview of the banking sector in South Africa in meeting transformational challenges faced by the country. According to the South African Reserve Bank (2008:106) the financial services sector including insurance, real estate and business services added 22% to the Gross Domestic Product (GDP) in 2007 making it the biggest contributor. It is therefore imperative for this study to be undertaken to assess and ensure that the sector commits to the process of transformation in addressing the past imbalances with regard to inclusive participation by all in the South African economy.
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An assessment of the progress made in the broadening of access to finance to low-income earners (1994-2007)
- Authors: Matoti, Nwabisa Babalwa
- Date: 2012-06-07
- Subjects: Housing Finance , Savings and loan associations , Housing policy South Africa , Housing South Africa , Housing, Rural South Africa Finance , Financial institutions South Africa , Financial Sector Charter , FSC , Rural Housing Loan Fund , NHFC , National Housing Finance Corporation , RHLF , National Housing Finance Corporation (South Africa)
- Type: Thesis
- Identifier: uj:8721 , http://hdl.handle.net/10210/5072
- Description: M.Comm. , The purpose of this dissertation is to assess the progress that has been made in the provision of housing finance to low-income earners. In 1994, housing affordability was constrained, as around 86% of households earned below R3 500. The focus, therefore, is on the role played by both government and the four major banks in broadening access to housing finance for these households and also those who earn less than R7 500. Frameworks that brought about certain initiatives aimed at addressing this problem are explored. On the side of government, the housing subsidy scheme and the role played by the government housing finance institutions (i.e. the National Housing Finance Corporation and the Rural Housing Loan Fund) are explored. On the banking sector side, the provisioning of housing finance prior to and after the implementation of the Financial Sector Charter (FSC) in 2004 is investigated. The dissertation concludes by looking the challenges that exist in the low-cost housing finance environment. The paper notes that, although some considerable progress has been made in the broadening of access to housing finance, there is a huge gap between the number of subsidies approved and the number of households that have benefited from the government subsidy scheme, possibly resulting from, among other things, capacity constraints at local government level. In respect of the banking sector, data analysed shows that bank involvement in the low-income market was very minimal before the implementation of the FSC. However, as much as some progress has been made, there are some serious challenges in this market that could have possibly prevented the role players from extending this access to the rest of the target group.
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