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Tito's farewell note cautiously upbeat

By Brendan Boyle | Sep 18, 2009 | COMMENTS [ 0 ]

FENDING off a barefoot Bavarian shareholder's criticism, Reserve Bank governor Tito Mboweni said farewell yesterday with a cautiously upbeat annual report - and news of a new currency set.

Mboweni, who makes way in November for former deputy governor Gill Marcus, said the domestic economy was likely to recover "somewhat" as global green shoots begin to grow.

But he cautioned: "There are some tentative signs, here and there, that we might see a recovery in the next couple of months, but . we have to be careful not to overstate that. Our recovery here is going to lag (behind) the global recovery."

Mboweni - who accepted a 14percent pay rise this year and a 28percent hike last year - cautioned that above inflation wage increases and rising administrative prices constrained the fight against inflation.

He said though low exposure to international debt had cushioned the domestic impact of the crash, credit impairments in the wake of the global crunch threatened the profitability of domestic banks.

"Increasing pressure on consumers continues to be clearly evident in the marked increase in impaired advances and rising credit impairments. However, the South African banking system remains stable and banks are adequately capitalised," he said.

Mboweni said Central Bank staff had surveyed the range of securitisation schemes that South African banks were involved in and would introduce legislative and regulatory amendments to ensure their continued stability.

Mboweni's presentation was repeatedly interrupted by an old foe, German shareholder Michael Duerr, who demanded speaking time to list his grievances against the bank and its governor.

Duerr told reporters he had worn traditional Bavarian lederhosen because he thought Mboweni might appear in traditional dress. He said he had shed his shoes to indicate his contempt for the Bank.

Mboweni said his behaviour showed contempt for all South Africans: "He attacks our people like dogs, it is very disrespectful."

Mboweni said the Central Bank was preparing a new series of notes and coins, which would be harder to forge. They would be released into circulation in mid-2013.

Acknowledging that it was his last annual meeting as governor, Mboweni told reporters: "I will miss the bank. It has been time well spent here."


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