New CCMA dates set for Lackay
FORMER Sars’ spokesman Adrian Lackay’s constructive dismissal case against the revenue authority has been postponed following wrangling between the parties over the presence of the media at the hearings. Lackay’s lawyer Brett Abraham said the arbitration was adjourned after Sars objected to the media contingent being present. Abraham said following discussions it was agreed the matter be postponed to dates that suited all parties between October and November. “The CCMA must follow its internal procedures in dealing with matters of this nature,” he said. – Sechaba ka’Nkosi INSURANCE and financial services outfit, Discovery, put local banks on short notice yesterday with the announcement that it was establishing a retail service bank in order to diversify its business.
The move will pit Discovery against the five established banks in a fiercely competitive market.
“We have never, ever been first to market; we have always been more of a disrupter,” Adrian Gore, the founder and chief executive of Discovery, said. “The behavioural model that we have has a great value in the banking space.”
Founded in 1992, Discovery’s model is linked to a behaviour tracking programme that rewards its health and life insurance clients for healthy lifestyles, paying for gym memberships or offering cash back on money spent at healthy restaurants.
“It’s a competitive market and I’m not sure their rewards programme will have the same impact in banking as it has in insurance because all the banks have some sort of loyalty programme,” one analyst said. “The omens don’t look good.” Discovery shares on the JSE fell as much as 4.7 percent before closing down 0.75 percent at R129.03.
The retail banking move, inspired by Discovery’s desire to diversify, will throw it into a market dominated by Standard Bank, FirstRand, Barclays Africa, Nedbank and Capitec.
Analysts said though it was early days, local banks needed to sit up and take notice because of Discovery’s reach with the affluent middle class and the loyalty it was building with its reward system, which could help it wrestle muscle share without too much sweat.
They warned as well that lessons had to be learnt from the meteoritic rise of Capitec Bank, which had carved its own niche from clients of already existing banks.
At the presentation of its results for the year to June, Gore announced the intention to expand its business model into banking and to establish an innovative full-service retail bank.
As a first step, Discovery is paying R1.3 billion to treble its stake in a credit card business to about 75 percent and will spend R800 million on working capital.
Gore said Discovery would increase its interest in the