Politics underpin many SA banks

25 October 2015 - 02:02 By THEKISO ANTHONY LEFIFI

ABSA, founded under another name in 1934 and known today as Barclays Africa Group, might not have seen the light of day had it not been for the determination of some 60 Afrikaner broeders (brothers) to heed the call for the establishment of an Afrikaner bank. LJ du Plessis, a prominent Broederbond member, is credited with calling for such a bank as far back at the 1920s, according to Hermann Giliomee, historian and political studies professor.In his book, The Afrikaners: Biography of a People, Giliomee writes that Du Plessis was convinced that Afrikaners were too weak to advance through the capitalist system, so he called for co-operatives to build up a bank and a shopping centre.story_article_left1At the time, like most black South Africans today, Afrikaners had no large industrial undertakings and only a very small share of the non-agricultural private sector of the economy. They had no banks or building societies, most of these being controlled by English-speaking South Africans.The Afrikaners implored English speakers to maintain "benign neutrality" while Afrikaners tried to find their "economic feet", Giliomee writes. This was tough given that some Afrikaners were against capitalism.Hendrik Verwoerd - who would become prime minister and go down in history as the architect of apartheid - said in 1939 that Afrikaners were "almost over-organised on the cultural terrain and unorganised in economic purposes".Joseph Jacobus Bosman became the first manager of Volkskas (which translates as "people's bank"), which ran as a co-operative until it became a commercial bank in 1941.Fifty years later it was the largest bank in South Africa, having merged with United Bank, Allied Bank and Trust Bank to form Amalgamated Banks of South Africa, or Absa .The bank was essentially set up as a rival to English banks such as Standard Bank, formerly known as Standard Bank of British South Africa, established in 1862.mini_story_image_hleft1Standard Bank dropped "British" from its name at its February 1883 shareholders' meeting. It was opening branches in areas such as Pretoria, Potchefstroom and Lydenburg, competing with fellow imperial banks entering the country via the Cape colony, Standard Bank says.The first bank to be established in the Cape was the Lombaard Bank, according to the South African Reserve Bank. It was a state bank and opened its doors in Cape Town in 1793, with a view to bringing additional money into circulation.This bank was entrusted with the issuing of government notes. It closed in 1883, unable to compete with private banks.The first private bank in South Africa was the Cape of Good Hope Bank, which opened in 1837. It is to this bank that Nedbank can trace its roots. In the 1900s it evolved into a regional bank, Boland Bank, Nedbank said.Prior to that, in 1892, the Kimberley Permanent Mutual Building and Investment Society had been formed. It would change its name to the South African Permanent Building and Investment Society and become known as Perm.It was first called Nedbank in 1971 after many metamorphoses. It was still regarded as the "white bank" until the late 1990s, while other players such as Absa, Standard Bank and FNB increasingly marketed their products to South Africa's black population...

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