SARB: South African financial system remains healthy, robust and resilient
The South African Reserve Bank (SARB) says South Africa's banks are adequately capitalised to deal with the effects of the credit rating downgrade by Standard and Poor's (S&P).
S&P lowered the ratings of seven of South Africa's commercial banks to sub-investment grade.
The bank says the downgrading of banks is directly related to last week's decision by S&P to cut South Africa's foreign currency denominated debt to sub-investment grade.
It says, however, the country's banks are able to deal with the effects.
"South African banks were last year subjected to a common scenario stress test, including a macroeconomic scenario that entailed excessive financial market volatility and risk aversion," says the bank.
SARB says the results of the stress test showed South African banks to be adequately capitalised to withstand significantly adverse scenarios.
It says the resilience of the banks stems from the high capital buffers that prevail in the South African banking system.
"Overall, the South African financial system remains healthy, robust and resilient despite some headwinds caused by elevated levels of domestic economic, financial and political events, as well as global financial market volatility."