South Africa | - Part 44

Fitch: South Africa Cabinet Reshuffle Signals Policy Change

JOHANNESBURG (Capital Markets in Africa) – South African president Jacob Zuma’s cabinet reshuffle signals a change in policy direction and will raise political tensions within the ANC and its traditional allies, potentially weakening public finances and standards of governance, Fitch Ratings says. The president announced that the new cabinet, in which he has replaced finance minister Pravin Gordhan with Malusi Gigaba, will work towards “radical socio-economic transformation.” In his February State of the Nation speech,…

Zuma’s Night of Long Knives Risks ANC Split, Credit Rating

Posted on by The Editorial Team

JOHANNESBURG (Capital Markets in Africa) – South African President Jacob Zuma fired Finance Minister Pravin Gordhan and made sweeping changes to his administration in a high-stakes power play that may threaten his own presidency and place the nation’s investment-grade credit rating at risk. Zuma replaced Gordhan, with whom he feuded over state finances, with Home Affairs Minister Malusi Gigaba, who has no financial or business experience. He also named lawmaker Sfiso Buthelezi to take over from Mcebisi Jonas as deputy finance minister. The…

South Africa Central Bank Signals End of Rate-Increase Cycle

Posted on by The Editorial Team

JOHANNESBURG (Capital Markets in Africa) – The South African Reserve Bank held its benchmark rate unchanged for a sixth straight meeting and said it may have reached the end of its policy-tightening cycle, even as the rand remains a risk to inflation. Five of the six Monetary Policy Committee members voted to keep the repurchase rate at 7 percent, and one favoured a 25 basis-point cut, Governor Lesetja Kganyago told reporters Thursday in the capital, Pretoria. The decision…

Hedge-Fund Owner Peregrine Considers Split to Boost Returns

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JOHANNESBURG (Capital Markets in Africa) – Peregrine Holdings Ltd., the operator of South Africa’s oldest hedge fund, is considering a plan to split the company by using profits from its stockbroking and wealth-management units to create a new investment firm. The stock surged the most in a year. The company, which also owns half of advisory business Java Capital, has about 1.5 billion rand ($115 million) of surplus cash on its balance sheet that could be…

Capitec Says Political Risk May Delay SouthAfrica Economic Rebound

Posted on by The Editorial Team

JOHANNESBURG (Capital Markets in Africa) – The uncertainty surrounding South African Finance Minister Pravin Gordhan’s future risks heaping extra pressure on consumers and delaying a rebound in the country’s economy, according to the nation’s largest provider of loans not backed by assets. “It’s going to be a difficult year if you look at the political risk,” Capitec Bank Holdings Ltd. Chief Executive Officer Gerrie Fourie said by phone on Tuesday. “It’s probably going to be much longer before there’s a turning point…

Too Soon to Call South Africa Rate-Hike Cycle End, Kganyago Says

Posted on by The Editorial Team

JOHANNESBURG (Capital Markets in Africa) – South Africa’s central bank can’t yet call the end of its interest rate-increase cycle, even as the risks to inflation have eased since the Monetary Policy Committee’s January meeting, Governor Lesetja Kganyagosaid. “It’s too early for me to make the call as to whether we are still on the tightening cycle or not,” Kganyago said in an interview with Bloomberg Television’s Jonathan Ferro. “We can’t say that” the increased cycle is…

Barclays Africa Debt Sale Misses Target as Banks Issue More

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JOHANNESBURG (Capital Markets in Africa) – Barclays Africa Group Limited sold less than half its target in a bond auction as a wall of debt issuance by South African banks and the impending exit of its U.K. parent, Barclays Plc, damped demand. Barclays Africa offered 1.5 billion rand ($113 million) of notes on Monday but raised only 642 million rand within price guidance, according to Deon Raju, head of treasury at the Johannesburg-based lender. The debt…

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