On 30 November 1999, the South African Reserve Bank received an application in terms of section 37(2) of the Banks Act from Nedcor Limited to acquire a majority shareholding in Standard Bank Investment Corporation Limited. Since the South African Reserve Bank is tasked with the administration of the Banks Act through the Office for Banks, due consideration has to be given to all categories of factors that have an impact on the banking system. The approval process must therefore run its course before a final decision can be reached.The Banks Act prescribes that, in the process of considering an application to acquire a significant interest in another bank, the competition authorities must be consulted on competition issues. Section 3 (1)(d) of the Competition Act, however, excludes acts that are subject to or authorised by public regulation. The Office for Banks and the Competition Commission are currently negotiating a memorandum of understanding in order to formalise an efficient working relationship in this regard. As a result of the impact of the possible take-over of one big bank by another big bank, due process must be followed, including consultation on competition matters. In the process, foreign supervisors will be consulted on matters of large take-overs to obtain their views on financial stability matters and to learn from their experience with issues that should be borne in mind in reaching a decision. Banking is essentially a service industry which revolves around people, both the personnel and the clients of a bank. Due consideration must be given to the efficiency of service provision to clients by the banks, both on a stand-alone basis and on a merged basis. In modern banking, technology is an important component in managing risks and providing information to all shareholders. The technical platforms, and computer architecture and compatibility to bring about a merged entity must be studied in order to establish whether or not efficiency will result.The ownership structures of the banks on a stand-alone basis and on a merged basis must be studied in order to establish whether the merged entity meets best-practice standards applied worldwide.Given all the criteria that must be studied and the information that must be gathered, it is obvious it that a thorough investigation must be undertaken before an answer can be provided regarding the application by Nedcor Limited to acquire control over Standard Bank Investment Corporation.I have asked both Nedcor Limited and the Standard Bank Investment Corporation to show maturity in managing the process, and to let commercial decisions prevail.I am convinced that, to the extent that it undermines confidence in the banks, a war of words in which each side tries to undermine the other cannot be good for the banking industry. I am also concerned about the behaviour of Old Mutual, which controls Nedcor Limited and is an important shareholder in the Standard Bank Investment Corporation. My view is that public comments issued by Old Mutual fanned the conflict between the two banks. All parties involved are requested to proceed responsibly and carefully. T. T MboweniGovernor ​