South African Reserve Bank. Group Annual Financial Statements for the year ended 31 March 2013

Transcription

1 South African Reserve Bank Group Annual Financial Statements for the year ended 31 March October 2013 Presentation to the Standing Committee on Finance

2 SARB Group The SARB Group (The Group) consists of the Bank and four wholly-owned subsidiaries. The Corporation for Public Deposits (CPD) Governed by the CPD Act Accepts call deposits from the public sector and invests in short term money market instruments Has an independent Board, appointed by the Minister of Finance Surplus profits are transferred to Government South African Bank Note Company (SABN) Registered in terms of the Companies Act Produces banknotes Has an independent Board and sub-committees

3 SARB Group (continued ) South African Mint Company (SA Mint) Registered in terms of the Companies Act Produces coin Has an independent Board and sub-committees South African Reserve Bank Captive Insurance Company (SARBCIC) Registered in terms of the Companies Act as a public company Carries out short-term insurance business for the Bank and its subsidiaries Has an independent Board and sub-committees

4 Financial Highlights of 2012/13 Rand depreciated over the year from 7.67 to 9.20 against the US Dollar, resulting in increases in the gold and foreign exchange holdings, as well as the GFECRA. Gold price increased to R per fine ounce from R (2012) further increasing the gold reserves. Gold holdings increased by 2246 fine ounces. The SABN was recapitalised through a subordinated loan of R1,1 billion in order to finance their factory modernisation programme. Current year drawdown R543 million (2012: R580 million).

5 Statement of comprehensive income Group R mil Bank R mil Interest Income Interest Expense (4 735) (2 865) (3 414) Net interest income Other income Operating costs (4 130) (3 904) (2 784) Loss before tax (1 991) (2 080) (679) Taxation Net loss (1 408) (1 499) (491)

6 Statement of comprehensive income Overview: BANK Loss after taxation Current year of R1,5 billion compared to the prior year of R491 million. Net interest income An increase of R232 million from the prior year Other income Decreased by R513 million mainly due to a decline in commission earned on cash handling at the branches. Operating costs An increase of R1,1 billion from last year mainly due to the following: Higher staff costs as a result of annual increment of 7%, increase in headcount necessary to support the latest regulatory requirements and a net increase in the post employment benefit actuarial valuations In November 2012 the new Mandela banknote series was launched, resulting in a higher cost of new currency compared to the prior year.

7 Statement of comprehensive income Overview: BANK (continued...) It is important to point out that the losses were incurred in the execution of the Bank s public duties and do not in any way relate to operational deficiencies or undue risks being taken. The Bank has a sound risk management framework, a disciplined budgeting process, and prudent expenditure management. Once the Bank returns to profitability, the Bank will need to rebuild the contingency reserve, and reconsider the appropriate level taking into account the losses for the past 3 years.

8 Statement of comprehensive income Overview: Group Loss after taxation Breakdown of the subsidiaries net profit contribution to the Group loss is as follows: Group R mil CPD SA Mint (5) (10) SABN 0 (146) SARBCIC (2) 5 Subsidiaries contribution 91 (101) Bank (1499) (491) Total loss after taxation (1408) (592)

9 Statement of financial position Group R mil Bank R mil Total assets Total liabilities Total capital and reserves USD / ZAR exchange rate Gold price, per fine ounce R R12 793

10 Statement of financial position Overview Total assets of the Bank increased by R75 billion (Group increase of R76 billion) Gold and foreign exchange increased by R71 billion R8 billion due to the gold price increase and R63 billion due to the depreciation of the rand. Total liabilities of the Bank increased by R77 billion (Group increase of R77 billion) GFECRA increased by R58 billion due to increases in the gold price and depreciation of the rand. Notes and coin in circulation increased by R13 billion and deposit accounts (mainly Banks Reserve Accounts) by R8 billion. Contingency reserve of the Bank decreased by R1,5 billion Loss of R1,5 billion decreased the contingency reserve balance which amounted to R6,0 billion at the reporting date.

11 Thank you