The Reserve Bank says its financial sector crisis forum (FSCF) is working to develop a response to a prolonged electricity outage which could force the finance sector and regulators to implement “an orderly closing and reopening of markets”.
The bank released the statement on Tuesday as Eskom announced that it would implement stage 6 load-shedding until further notice as a number of units at multiple stations faced myriad challenges at the weekend.
The FSCF was established under former Reserve Bank governor Tito Mboweni in 2001 after the 9/11 attack on the World Trade Centre in the US. The forum allows the finance sector and regulators to discuss financial stability concerns regularly.
The bank said its financial stability mandate meant it had a duty to assess potential systemic risks to the financial system, compile crisis management plans and mitigate such risks. While it said the forum existed to test the financial system's resilience to risks such as a blackout, the bank considered a national grid failure “unlikely”.
“The FSCF has since 2015 been preparing plans to respond to a national or regional electricity grid failure. As part of these preparations, it has been in regular contact with Eskom, the petroleum industry and the telecommunications industry,” the statement said.
“Crisis management plans are typically based on a range of likely but low probability scenarios and that a crisis management plan exists should not be interpreted as a signal that the bank is anticipating any specific scenario to materialise,” it said.
Bank deputy governor Kuben Naidoo chairs the FSCF which includes members from the National Treasury, the Financial Sector Conduct Authority, the Association for Savings and Investment South Africa, Banking Association South Africa and the Financial Intelligence Centre.
TimesLIVE
Support independent journalism by subscribing to the Sunday Times. Just R20 for the first month.
Reserve Bank working on blackout contingency plan
Image: Alaister Russell
The Reserve Bank says its financial sector crisis forum (FSCF) is working to develop a response to a prolonged electricity outage which could force the finance sector and regulators to implement “an orderly closing and reopening of markets”.
The bank released the statement on Tuesday as Eskom announced that it would implement stage 6 load-shedding until further notice as a number of units at multiple stations faced myriad challenges at the weekend.
The FSCF was established under former Reserve Bank governor Tito Mboweni in 2001 after the 9/11 attack on the World Trade Centre in the US. The forum allows the finance sector and regulators to discuss financial stability concerns regularly.
The bank said its financial stability mandate meant it had a duty to assess potential systemic risks to the financial system, compile crisis management plans and mitigate such risks. While it said the forum existed to test the financial system's resilience to risks such as a blackout, the bank considered a national grid failure “unlikely”.
“The FSCF has since 2015 been preparing plans to respond to a national or regional electricity grid failure. As part of these preparations, it has been in regular contact with Eskom, the petroleum industry and the telecommunications industry,” the statement said.
“Crisis management plans are typically based on a range of likely but low probability scenarios and that a crisis management plan exists should not be interpreted as a signal that the bank is anticipating any specific scenario to materialise,” it said.
Bank deputy governor Kuben Naidoo chairs the FSCF which includes members from the National Treasury, the Financial Sector Conduct Authority, the Association for Savings and Investment South Africa, Banking Association South Africa and the Financial Intelligence Centre.
TimesLIVE
Support independent journalism by subscribing to the Sunday Times. Just R20 for the first month.
MORE
Eskom does not expect load-shedding to reach stage 8, says De Ruyter
Eskom and Treasury warn of 'catastrophic' risks to fiscus if there is no tariff increase
Mismanagement and inefficiency are not the cause of Eskom’s financial woes, says CFO
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Related articles
Most read
Latest Videos