Released on = March 6, 2007, 4:40 am

Press Release Author = Shushmul Maheshwari

Industry = Financial

Press Release Summary = Seeing the negative side of excessive borrowing in the
country, the South Korean govt. is gearing up to curb the same.

Press Release Body = Government of South Korea is on the lookout for alternatives,
other than increasing the interest rates, in order to curb the excessive borrowing
trend in the country, Thabo Mbeki, president of SA, said on 11 February 2007, as per
Reuters.

Mbeki said that instead of hiking interest rates, targeting the capital adequacy
ratio of the banks could be a rather better option to curtail borrowing.

\"It isn\'t necessary to always use what is a blunt instrument, interest rates. you
could come at this matter in a more targeted way, to address whatever,\" he told the
SABC TV in an interview. \"We have started looking at that question and I am quite
sure that later this year we will be able to say something about this.\"

The suggestion came after a similar threat from the governor of Reserve Bank Tito
Mboweni late last year (2006). He had warned the banks that if they did not stop the
madness of disproportionate lending that was contributing to the higher rate of
inflation, he would be forced to increase the amount required to hold in central
bank reserve.

Consumer spending, fueled by the record year-on-year growth of above 25% in credit,
is still a concern for the bank even when inflation has been going down beyond
expectations for the past few months.

As per RNCOS report on "Banking Sector in South Africa", the number of credit cards
rose at a CAGR of 10.68% during 2001 & 2005. In 2005, the number of credit cards
reached 280.1 Million, representing a 16.24% growth over the figure of previous
year.

The report further states that the sharp increase in credit cards indicates growing
demand for borrowing more money owing to the lower interest rates offered by the
banks in the country.

About the Report

The research report answers the key questions, such as what does the competitive
market landscape look like for the South Africa Banking Industry, what are the
various opportunities and challenges before this industry, what are the most
prospective areas for banks to invest in near future, which factors will lead to the
growth of financial cards, loans and deposits in South Africa, how financial sector
charter and BEE (Black Economic Empowerment) are affecting the banking sector in
South Africa, and so on.

About RNCOS:

RNCOS, incorporated in the year 2002, is an industry research firm. It has a team of
industry experts who analyze data collected from credible sources. They provide
industry insights and analysis that helps corporations to take timely and accurate
business decision in today\'s globally competitive environment.

For more information visit: http://www.rncos.com/Report/IM0100.htm
Current Industry News: http://www.rncos.com/blog


Web Site = http://www.rncos.com

Contact Details = RNCOS
Shushmul Maheshwari
Head of Business Development
29, 1st Floor, Patparganj Industrial Area, Delhi 92
91-11-4214-1229
info@rncos.com