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XINHUA NEWS SERVICE REPORTS FROM THE AFRICAN CONTINENT

 

African central banks meet in South Africa to share best practices

PRETORIA South Africa (Xinhua) -- Representatives from African central banks are holding a four-day meeting in Pretoria, South Africa, to discuss the impact of International Financial Reporting Standard 9 (IFRS9) on banks and regulators in the continent. 

The workshop is organised by the Working Group on Cross-border Banking Supervision and the South African Reserve Bank (SARB).

Opening the workshop on Monday, Francois Groepe, deputy governor of SARB, encouraged Association of African Central Banks to tackle challenges affecting them.

Adhering to international financial standards will prevent the repeat of the disastrous global financial crisis of 2007-2008, Groepe said.

He said the crisis highlighted the systemic costs of a delayed recognition of credit losses on the part of banks and other lenders, and the application of the prevailing standards at the time was seen as having prevented banks from provisioning appropriately for credit losses likely to arise from emerging risks.

These delays resulted in the recognition of credit losses that were widely regarded as “too little, too late,” and gave rise to questions of pro-cyclicality by spurring excessive lending during the boom and forcing a sharp reduction in the subsequent bust, he added.

Some financial experts believe that after that global financial crisis, banks are now better capitalized with higher buffers and are better able to absorb losses.

The SARB deputy governor said while many workshops have been held in the past two years, there have never been one focusing specifically on Africa.

“There are factors that are unique to Africa that need to be taken into account,” Groepe said. “With this workshop, we want to fill this gap and provide a platform for African regulators to discuss the specific issues and concerns that may affect them in the implementation of IFRS 9.”

The International Accounting Standards Board issued IFRS 9 on July 24, 2014, to replace the existing standard. IFRS 9 has a mandatory effective date of Jan. 1, 2018.

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UPDATE:

Johannesburg Stock Exchange closes lower on Tuesday pulled down by Naspers

JOHANNESBURG South Africa (Xinhua) -- The Johannesburg Stock Exchange (JSE) tumbled sharply on Tuesday after a public holiday in South Africa on Monday, with industrial stocks leading the broad-based declines.

Naspers, by far the biggest share on the JSE representing more than 12 percent of its market value, pulled the JSE sharply lower on Tuesday. Naspers was off 3.19 percent to R2867.59.

The South Africa rand was at R13.4 to the U.S. dollar, down from R13.32, at R15.76 to the euro, up from R15.79, and at R17.94 to the pound, up from R17.95.

The all share index was off 1.38 percent to 55,070.38 points at close of session. The top 40 index was 1.5 percent down at 48,819.35 points. The industrial index dropped 1.56 percent, and the financial index 1.4 percent.

Gold shares gained 0.86 percent after the gold price rose more than 1 percent on political uncertainty, but resources shares were also 1 percent lower.

Anglo American was off 2.49 percent to R231.2 and Assore 3.44 percent to R258.30.

Bank and financial stocks were also much weaker, with Barclays Africa losing 1.95 percent to R136.87, Capitec 2.64 percent to R884.70 and Standard Bank 3.03 percent to R157.72.

Sanlam gave up 2.34 percent to R67.49 and Liberty Holdings 1.6 percent to R101.75.

Woolworths dropped 1.9 percent to R58.73 and Steinhoff 1.12 percent to R59.22.

Mediclinic International was down 4.45 percent to R116 and Aspen 1.95 percent to R306.01.

Shoprite, which will soon be part of the Steinhoff Retail Africa group, lost 0.23 percent to R205.55.

             

 

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