The South African Reserve Bank (SARB) marked its centenary with a virtual celebration and the launch of a commemorative R5 coin.
The SARB, the oldest central bank in Africa, was established as a result of unusual financial and monetary conditions stemming from World War I (1914–1918).
It opened its doors on Pretoria’s Church Square on June 30 1921 and issued its first banknotes on April 19 1922, with its own coins a year later.
South Africa replaced the pound with a decimal system, introducing the rand on February 14, 1961, shortly before the country became a republic.
This history of the bank was outlined by Governor Lesetja Kganyago, the 10th governor who joined the bank in 2014 and was reappointed in 2019.
Kganyago described the SARB as “a solid institution of our democracy, and one all South Africans can be proud of”.
The mandate of the SARB is primarily to achieve and maintain financial stability, and it played a key role in guiding the country through the 2008 global financial crisis and, more recently in South Africa’s response to the Covid-19 pandemic.
The SA Reserve Bank building in Pretoria, the city’s tallest building. Picture: Val Boje
He reflected on the “deep economic trouble” apartheid South Africa was in with inflation reaching a high in 1986, and the crucial changes that came to the SARB with the advent of democracy.
Former president Nelson Mandela kept then governor Chris Stals on to retain institutional memory, ensure stability, and gain investor confidence, while preparing for its transformation.
With greater responsibility in the rebuilding of the country’s economy, in 2000 SARB introduced an inflation targeting monetary framework which now aims to maintain consumer price inflation between 3% and 6%.
SARB had responded quickly with actions to limit economic damage due to Covid-19 and Kganyago was optimistic that economic recovery was on track despite pitfalls along the way, such as the return to an adjusted level 4 lockdown.
Various speakers congratulated the SARB on its milestone, including the Minister of Finance, Tito Mboweni, who served as the eighth governor.
He said he had been called to a briefing with former president Thabo Mbeki in 1988 where it was announced he would join the SARB as an adviser to Stals.
This was “a diplomatic way of saying I was governor designate” as the central bank was on the path to transformation, he said. Both Stals and Gill Marcus, who served from 2009-2014, congratulated the bank with Marcus describing its increasing role and influence in regional and international associations such as the International Monetary Fund (IMF).
Richard Wainwright of Investec, representing the Banking Association of SA, commended the SARB for creating a stable banking environment, and fiercely maintaining its independence and resisting external political pressure.
Aside from monetary policy, the SARB is responsible for printing and minting banknotes and coins and important occasions are an opportunity for commemorative currency.
The online audience heard how the centenary of the birth of former president Nelson Mandela in 2018 was marked with the current banknotes: with his birthplace on the R10, his Soweto home on the R20, the Howick capture site on the R50, his imprisonment mostly on Robben Island on the R100 and inspiration for the R200 coming from his greeting of the nation on his release in 1990.
The R5 coin from that time has a portrait of Mandela and this coin remains in circulation. Twenty five years of democracy was celebrated with a commemorative coin series, designed by young artists and the new R5 coin depicts the design of previously issued coins, including the 1923 three pence (the tickey) and a new 10c coin to be released soon depicting the Cape honey bee.
A refreshed SARB currency app (available to download free from mobile app stores) will create greater public awareness of the role of SARB, money and the economy, and details of the security features of banknotes and design of our coins.