Regulatory Alerts2013-10-28
Clarification of Requirements for Approving Acquisitions of Interests Outside the Republic Under Section 52(1)(c) of the Banks Act, 1990
The South African Reserve Bank’s Registrar of Banks issued Directive 13/2013 to clarify approval requirements for banks and controlling companies acquiring interests in foreign undertakings under Section 52(1)(c) of the Banks Act, 1990. The directive establishes a five percent aggregate effective interest threshold and a one percent qualifying capital and reserve funds threshold, distinguishing between acquisitions requiring prior written approval and those subject to simple notification. It further mandates prior approval for sub-threshold investments that significantly impact financial position, business strategy, or supervisory information flows, thereby resolving previous impractical applications and unintended regulatory consequences.
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