Bankers Unfazed as Sanctions against South Africa Loom
Mackenzie, Christina, American Banker
Bankers Unfazed as Sanctions Against South Africa Loom
Anti-apartheid sanctions that would place curbs on the activities of U.S. banks in South Africa are contained in both the House- and Senate-passed versions of proposed legislation. Despite this, spokesmen for some of the large money center banks, including three big banks that have offices in South Africa, said they were not concerned.
"For us, that [bill] is no change,' said Richard Stilley, spokesman for the NCNB Corp., headquartered in Charlotte, N.C.. He said the firm has not made loans in South Africa for about a year.
A similar response was given by a spokeswoman for Continental Illinois National Bank and Trust Company of Chicago. "We're not putting any money into that country,' she said, "and we haven't for a long time.'
The sanction effort "doesn't really impact us,' said Kenneth Herz, a Chemical Bank spokesman. The bank, he said, has a long-standing policy against loans to the South African government.
Mark Serepca of the American Bankers Association said that while the organization opposes formal legislation, it is encouraging its member banks to refrain voluntarily from making loans in South Africa.
Some bankers would not comment on the sanctions, saying they had not had time to study the details of the bills and would wait to see what changes will be made in the legislation.
The final shape of legislation still has to be worked out in the conference committee, resolving differences between the measure approved by the Senate and the tougher bill passed by the House on June 18.
And although a White House spokesman said last week that the President continues to oppose punitive measures, given the wide margins of victory for some sanctions, Congress may override the President's policy with a veto proof bill this fall.
The Senate sanctions bill, passed last week, essentially would ban new deals between U.S. lenders and the South African government.
Importantly, it also threatens to force U.S. banks out of the South African consumer markets if certain reforms are not instituted by Pretoria within 12 months of enactment. These further sanctions include the possibility of a prohibition against U.S. banks accepting deposit accounts from South African nationals.
Penalties for violations would include $10,000 and/or five years in prison for individuals, and $1 million for businesses. …