The South African Reserve Bank (SARB) is the central bank of South Africa. It was established in 1921, through the promulgation of the Currency and Bank Act of 10 August 1920. It was created as a direct result of the abnormal monetary and financial conditions which World War I had brought. The SARB was only the fourth central bank established outside the United Kingdom and Europe, the others being the Federal Reserve, Bank of Japan and Bank of Java.
The earliest suggestions for the establishment of the Central Bank in South Africa date back to 1879. A select committee, of ten members of Parliament, was established on 31 March 1920 to examine the benefits to the national interest of the establishing of the central bank.
Functions of the South African Reserve Bank
- Formulating and implementing monetary policy;
- Issuing banknotes and coins;
- Supervising the financial services sector;
- Ensuring the effective functioning of the national payment system (NPS);
- Managing official gold and foreign-exchange reserves;
- Acting as banker to the government – but not owned by South African Government.
- Administering the country's remaining exchange controls; and
- Acting as lender of last resort in exceptional circumstances.
Organisational structure
Board of directors
thumb|263x263px|South African Reserve Bank head offices in Pretoria. The site is planned to be renovated, including the addition of a Reserve Bank museum.
SARB has a board of directors consisting of a Governor Lesetja Kganyago three Deputy Governors, and eleven Directors. The Governor, and Deputy governors are appointed for five-year terms by the President of South Africa in consultation with the Minister of Finance. Four of the directors are also appointed by the President for terms of three years. The remaining seven directors are appointed by the Shareholders of the Bank, also for a three-year term.
Ownership
The Reserve Bank, with 2 million issued shares, is one of eight reserve banks worldwide that have shareholders other than the governments of their respective countries (the others being Belgium, Greece, Italy, Japan, Switzerland, Türkiye and the United States).
The South African government has announced that it plans to nationalise the Reserve Bank.
List of governors of the South African Reserve Bank
- William Henry Clegg – December 1920 – December 1931
- Johannes Postmus – January 1932 – June 1945