The South African Reserve Bank has over many years established various bilateral foreign credit facilities with a number of international financial institutions. These credit facilities are utilised from time to time to supplement the country's foreign reserves. At the end of May 1997, the aggregate of these facilities amounted to the equivalent of R18,5 billion, of which only R1,8 billion was utilised.The Bank has recently negotiated with a number of international banking institutions to consolidate part of the existing credit lines into a more firmly established medium term revolving credit facility. The Bank is pleased to announce that the first phase of these negotiations for the establishment of a new syndicated facility for a total amount of US $1,5 billion, has now been successfully completed with the entering into an agreement with twelve banks joining the facility as "Arrangers". A second phase to include Co-Arrangers and Lead Managers will now be launched by the Reserve Bank and a select group of relationship banks are expected to be approached on 24 June 1997.The twelve banks who have agreed to form the Arranging Group are:The Bank of Tokyo-Mitsubishi, LimitedChase Investment Bank LimitedCommerzbank AGCredit Suisse First BostonDeutsche Morgan GrenfellDresdner Bank Luxembourg SAHSBC GroupJP Morgan Securities, LimitedNatWest MarketsSBC WarburgSociété GénéraleUnion Bank of Switzerland The following Terms and Conditions will apply to this facility:Amount.. US $1,500 millionMaturity.. Three yearsInterest.. LIBOR plus 30 basis pointsCommitment fee.. 15 basis points per annumFees:.. 20 basis points to Arrangers at US $100 million .. 17,5 basis points to Co-Arrangers at US $50 million .. 15 basis points to Lead Managers at US $25 million The advantages for the Reserve Bank of the new facility are that it will cover a longer maturity than normal credit lines; it will be negotiated at a lower average cost; it will have greater transparency in the global financial markets; and it should inspire more confidence in South Africa's ability to provide liquidity when and if needed by the South African foreign exchange market. After completion, the total credit facilities available to the Reserve Bank may increase, but not to a significant proportion of the new facility as some existing credit lines will be absorbed within the new facility, or will be terminated on maturity.The Reserve Bank is confident that, taking account of the current level of the official foreign reserves and the total of unutilised foreign credit facilities available to the Bank, any additional demands for foreign currency that may arise from the further relaxation of the exchange controls and not covered by a continued inflow of foreign capital, will be met.