Generally, conditions in the global financial system are still influenced by above-normal levels of uncertainty, highlighting the fact that the process of repairing impaired financial systems is far from complete. In South Africa, despite positive signs of economic recovery, employment continued to decline, placing a significant damper on the domestic financial system.
Nevertheless, the banking and insurance sectors maintained high-quality capital buffers well above the minimum prudential requirements, and remained profitable. Growth in bank credit granted has begun to increase, the growth rate in impaired advances is decelerating and lending standards of banks are showing signs of loosening.