Business Monitor International's South Africa Commercial Banking Report 2008 provides industry professionals and strategists, corporate analysts, banking associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on the Commercial Banking industry in South Africa.

The Report has just been researched at source, and features latest-available data covering production, sales, imports and exports; 5-year industry forecasts through end-2012; company ranking and competitive landscapes for multinational and local manufacturers and suppliers; and analysis of latest industry developments, trends and regulatory changes.

Key Benefits of Report

Rely On Our Independent 5-Year Forecasts As A Benchmark
to test other views - a key input for successful budgetary and strategic business planning.
Target Business Opportunities & Risks
through our reviews of latest industry trends, regulatory changes, and major deals, projects and investments.
Exploit Latest Competitive Intelligence & Company SWOTS
on your peers and competitors through company rankings by sales, market share, investments and leading products and services.

South Africa Commercial Banking Report includes:

Executive Summary & Swot Analysis

Summary of BMI’s key industry forecasts and trend analysis, and commentary on key company and industry headline events. Collection of SWOT studies on local commercial banking market, economy and business environment.

Regional Overview

Cross-border analysis on the structure, size and value of the commercial banking sector, including comparative historical data and forecasts on the region’s assets, loans and deposits, as well as bond portfolios.

Market Overview

Outlook of local market, commenting on its structure, size and value.

BMI 5-Year Industry Forecast

Annual average growth forecasts for assets, loans and deposits.

BMI 5-Year Macroeconomic Forecast

BMI forecasts for all headline macroeconomic indicators, including real GDP growth, inflation, fiscal balance, trade balance, current account and external debt.

Competitive Landscape

Comparative company analyses and rankings by production, sales, % market share, employees, registration date and ownership structure.

Company Profiles & SWOTS

Company profiles, including SWOT (Strengths, Weaknesses, Opportunities & Threats)analyses, fully researched senior executives and full contact details, business activity, leading products and services.

Executive Summary

[TOP]

Leadership Elections Will Provide Drama The remainder of 2007 will be of potentially high political drama in South Africa, with the ruling ANC Party’s December leadership elections expected to prompt some impassioned and divisive campaigning. The left-leaning former vice president Jacob Zuma is expected to make a considerable challenge for the leadership ticket, the winner of which is almost certain to become president following the 2009 elections. Economically, the country will remain on a solid growth path, though any downturn in global sentiment risks unhinging recent progress. South Africa is particularly vulnerable in this regard. However Zuma does pose a risk. His populist and left-leaning rhetoric is not only likely to be a turn off for foreign investors, but it also risks raising social tensions against the sensitive demographic backdrop that is South African society. Our core view is that the pro-business faction of the ANC, currently represented by President Thabo Mbeki, will come out on top, helping to ensure prudent economic policy over the forecast period. Indeed, the latest budget speech revealed continued sensible fiscal planning, with significant emphasis on infrastructure investment, which is expected to result in the country’s first fiscal surplus in recent history. Final quarter of 2006 GDP by expenditure figures in South Africa were very strong, with real growth coming in at 5.15% y-o-y (seasonally adjusted annualised), leaving overall growth at 4.98% for 2006. The market's view, and ours, has been that the South African economy is undergoing a period of structural adjustment whereby growth would rebalance away from household expenditure, and toward investment. Although there were further signs of growing levels of investment in the economy, there was very little indication that household expenditure levels have begun to soften in response to tighter monetary policy. Consequently, this has contributed to the largest current account deficit in the post-apartheid era, at 7.8% of GDP in Q406, on an annualised basis. Overall, while the growth figures are positive, the South African Reserve Bank may be concerned about the minimal impact that monetary tightening has had on domestic demand so far. Apart from a moderation of vehicle sales expansion, which in any case have been in decline from mid-2006, there is little evidence of the economy slowing down. Money supply and domestic credit extension growth figures, while off their peaks, have not confirmed that a downward trend is about to ensue. In light of these figures. we feel that the risks of the SARB further tightening liquidity have risen, and do not rule out an interest rate hike in June. South Africa Commercial Banking Report Q2 2007 © Business Monitor International Ltd Page 11 The Commercial Banking Sector South Africa’s banking sector is not only the largest and best developed in Africa, its leading players are genuine multinationals with a presence in first world economies such as England and Australia as well as the countries in its own region. They have also attracted foreign investment, with Barclays buying a 56% holding in South Africa’s second largest bank, Absa. Australia’s Macquarie Bank and Richard Branson’s Virgin are also buying positions in the market. Given the consumer credit boom that has been taking place in South Africa – loan growth was 29% in the 12 months to December 31 2006 – it is not surprising that bank profits have been very strong. This has had the rather less desirable effect of attracting the attention of the Competition Commission. The commission has begun an enquiry into bank charges and the payments system. It is due to report by June 2007. In the context of a successful economy, BMI is expecting that banking assets and deposits will all grow at an average 18% pa in local currency terms through to 2010 and about half that in US dollar terms. We expect loans to grow at around 21% during the same period. During this time, total assets will grow from US$297bn to US$470bn. Loans will grow to US$523bn and deposits to US$411bn. The loans/deposits ratio that is already a relatively high 112.2% will then have risen to 127.3% while the assets/loans ratio will be a more moderate 90%. The general environment remains favourable. Press Reports Recent reports in the domestic and international press have shown a number of new developments in the South African Banking sector. Britain's Barclays announced that it would reintroduce its Barclaycard branded credit cards in South Africa. The Visa credit cards will be issued through South Africa's biggest retail bank, Absa, majority owned by the British banking group. Absa also announced plans to proceed with the acquisition of Barclays' African operation and said it would review products, prices and services to ensure they are in line with market and regulatory requirements. South Africa's Standard Bank Group finalized its acquisition of BankBoston Argentina, enabling it to extend its position in the South American market. The Reserve Bank has three applications for registration of small banks, two of which are from foreign banks wanting to open a branch. No new small bank has opened in South Africa since 2001, largely because of increased regulation and compliance requirements.

Read about our other Commercial Banking Reports

Asia	Europe	Middle East & Africa	Latin America
China Hong Kong India Indonesia Japan Malaysia Philippines Singapore South Korea Taiwan Thailand	Czech Republic Greece Hungary Latvia Poland Romania Russia Slovakia Slovenia	Egypt Iran Nigeria Saudi Arabia South Africa Turkey UAE	Argentina Brazil Chile Mexico Venezuela
[top]

Business Monitor International
A Market Leader in Country Risk, Industry Intelligence and Company Research

Mermaid House, 2 Puddle Dock, Blackfriars, London EC4V 3DS, UK

BUSINESS MONITOR INTERNATIONAL's country risk analysis and forecasts, market research on leading industries, and multinational company research is relied upon by corporates, banks, government departments and multilateral organisations in over 125 countries around the world.

Country Risk Analysis and Forecasts
BMI has for 24 years specialised in political risk analysis, financial markets analysis, and macroeconomic forecasts on 175 global markets.

Industry Intelligence and Market Research
BMI's industry research covers Automotives; Banking; Chemicals; Defence & Security; Food & Drink; Freight Transport; Information Technology; Infrastructure; Insurance; Mining; Oil & Gas; Petrochemicals; Pharmaceuticals & Healthcare; Power; Telecommunications, and Tourism.

Company Research
BMI maintains a fully-researched 55,000-site database of multinational company subsidiaries located across global markets.