The Banking Association Summits are held annually. Each summit is based on a current theme of importance to the banking and/or financial industry, within the context of its role in the broader socio-economy.
There is course for optimism. Some things work and work very well. I am referring here to our banking system. Having a sound and highly regarded banking system is a starting point to turn our economic woes around.
The strength of our banking system is anchored on strong and well-managed institutions that comply with the best global standards and regulations. For example, in the recently released Lafferty report on annual Bank Quality Rankings, five of South Africa’s banks ranked in the top 8 with Capitec taking the top position.
We are also acutely aware as an industry that banks are critical institutions in society and we must conduct our business in a way that contributes to societal wellbeing. Millions of South Africans have entrusted us with their hard-earned money. We have a duty to act in their best interest.
Our customers matter to us and we matter to them. This is a relationship of trust and we are committed to keep our end of the bargain, which includes advocating a broad environment in which banks can do responsible business.
Why do we need banks?
Think for a moment about where the world would be without banking. Local shops would not be able to pay their suppliers, leaving them without the goods that their loyal customers expect to find in the shelves. The entire logistics network that enables supply chain systems to work rely on the banking system. The entire tourism industry would be brought to a standstill as airlines, hotels and car rental companies would be unable to process payments.
Banking matters to South Africans for other reasons. Without it, only a few people would be able to own their homes. Banking makes home ownership achievable to more (admittedly not all) people. We turn dreams of business ownership into reality. Without banking, business ownership would only be possible for a small group of rich people.
When you see a road being built in a rural village, a mall in a township or renewable energy project, you should always remember that banking made it possible. We do this by extending loans using our depositors’ money and by raising money in capital markets. Even a wholly government-funded project is enabled by banks – after all the collection of taxes which government uses to fund development projects would be impossible without banks.