In South Africa, this objective was mainly pursued through the regulation and supervision of banks, which has been the responsibility of the Bank Supervision Department within the Bank. It soon became clear, however, that sound and profitable individual banks did not guarantee a sound banking and financial system.
Banks often have inter-linkages and might have significant common exposures to risks that will not be visible from the supervision of individual banks. Hence the need for macro-prudential surveillance, or the monitoring of the “prudence” of the “broader” financial system was identified and which culminated in the SARB creating such capacity for this purpose as far back as 2001.