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South African Banking Regulation
  1. Introduction
  2. A Bank and the Business of a Bank
  3. Exempt Activities
  4. Registration
  5. Criteria for Registration
  6. Inspection
  7. Insolvancy
  8. Foreign Banking Operations in
    South Africa through Branch Offices
  9. Prudential Requirements
  10. Tax Implications
  1. Takeovers and Mergers
  2. Regulatory and Supervisory Rules for Banks
  3. Agreements regulated by the National Credit Act
  4. Default
  5. National Credit Regulator
  6. Disclosure
  7. Registrar of Banks
  8. Reform or Structuring of Banking System
  9. Potential International Convergence of
    Banks Supervisory Standards
 

1. Introduction

Originally written for the Centre for International Legal Studies, this is a study by Joz Coetzer and Hans Evenhuis into the formal requirements for a Bank to conduct the business of a bank in the Republic of South Africa. The legal and formal requirements to be met before a bank may accept deposits, conduct the commercial activities of banking and the registration requirements for foreign banks doing business in South Africa. Liquidation proceeding in relation to banks, investment prudence, taxation of banks (including foreign banks conducting business through branches) and various statutory arrangements affecting business in general and banks in particular are discussed. Some specific legislation is discussed including consumer credit law, usury and the legal consequences of breach of contract.

The South African banking system is well developed and effectively regulated. In his address to the inaugural meeting of the Association of Banking lawyers of South Africa in April 1996, Prof Philip R. Wood of the University of London grouped the South African banking jurisdiction in the same category as that of Japan, Korea, Liechtenstein, Scotland, the Channel Islands and Quebec, which he calls the mixed Roman/common law group. This group has a broadly commercial system of law with reasonably wide security, reflecting the Germanic pro-creditor approach but without being as extreme pro-creditor as the English-based common law group.

These jurisdictions "have the trust which is essential for the operation of a commercial system …". Prof Wood further complimented the contribution of legal scholarship in South Africa to the development of financial law globally.

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