By Fakir Hassen, IANS
Johannesburg : The State Bank of India (SBI) here has denied reports about its takeover bid of South Africa’s Capitec Bank.
The Economic Times in New Delhi had earlier published a story about the proposed takeover bid, sparking strong market speculation that saw Capitec’s share price rocket, but both banks have strongly denied the claims.
“If both banks are not the source of The Economic Times, then what is the source?” SBI’s regional chief executive officer Vijay Jasuja told IANS here Tuesday, adding that he had written to the newspaper to let him know this.
Jasuja said he had spoken in a general way about the excellent prospects for future growth for the banking industry in South Africa when asked to comment on the economic situation in South Africa, and had never mentioned any takeover ideas.
Rian Stassen, chief executive of Capitec Bank, also denied that the bank or its shareholders had been approached by the State Bank of India.
Jasuja said he had also written to the South African Reserve Bank to clear the air, and the rumours had also been denied by his head office in India.
“Any matter such as (a proposed takeover bid) is a strategic decision that is taken at a senior level and we would certainly not enter into such discussions here.
“The State Bank of India is owned by the government, and operates in an open and transparent manner. There is nothing secret about what we do.
“As a global bank, we normally will open more branches in any country that presents opportunities, through the regulator (in that country).
But despite the extensively reported denials, market analysts said such a move would be beneficial to both parties. They said SBI could benefit from the experience of Capitec in the small loans market, which are not underwritten by assets while Capitec could leverage the SBI market that had already been established.
The reports about an SBI Capitec deal sparked great media and investor interest here because it came hot on the heels of the biggest ever investment in the African continent by China when China’s largest bank, the Industrial and Commercial Bank of China (ICBC), bought a 20 percent stake in Standard Bank, South Africa’s largest bank by assets and earnings, for $5.5 billion.