The South African Reserve Bank has made nearly 150,000 shares available for purchase to the public.
This follows a High Court ruling last year which directed some Reserve Bank shareholders to sell shares in excess of the statutory limit of 10 000.
Reserve Bank Governor (Sarb) Lesetja Kganyago, made an official announcement today.
Kganyago says shareholders will have no say over the executive running of the bank but can elect a maximum of seven non-executive directors of the board and approved by a panel chaired by the governor of the Sarb.
Founder of Just One Lap, Simon Brown, highlights some other pros and cons of investing in Sarb.
Every year your share will pay you 10c, what we call a dividend. You will get 10c per share. The share costs R10 so effectively you get a 1% payment back on the share every year.— Founder of Just One Lap, Simon Brown
Shareholders don’t get set interest rates, they don’t get to decide any policy at the reserve bank beyond nominating a few non-executives.— Founder of Just One Lap, Simon Brown
You are not nominating people to sit on the monetary policy committee which is the group of men and women who set out interest rates.— Founder of Just One Lap, Simon Brown
From the perspective of an investment this is not a great investment…the value of the shares never changes. They are today what they were in 1920.— Founder of Just One Lap, Simon Brown
I think a part of what the governor is doing is saying let’s get as many South Africans out there and buying some…he really wants to diversify that base and get more individuals on board.— Founder of Just One Lap, Simon Brown
Listen to the full interview below...
This article first appeared on 702 : Now you can buy shares in the Reserve Bank (But is it a good idea?)