Old Mutual plc has been granted initial approval to launch a bank by the Prudential Authority (PA), the South Africa (SA) financial regulator that falls under the auspices of the SA Reserve Bank (SARB).
Old Mutual plc is an international investment, savings, insurance and banking group that was established in South Africa 1845 as a mutual insurance company. It is the parent company of Old Mutual Zimbabwe.
The diversified international financial services group is listed on the stock exchange in London, South Africa, Malawi, Namibia and Zimbabwe.
"Old Mutual is pleased to announce that, following a stringent regulatory review of its application in terms of Section 16 of the Banks Act 94 of 1990, as amended ("Banks Act"), the Prudential Authority has granted the Group approval to establish a bank subject to certain licence conditions," the group said in a statement also published on the Zimbabwe Stock Exchange website.
"The banking regulator approved Old Mutual's section 16 application for a licence to establish a bank, subject to certain conditions. Old Mutual plans to call its new lender OM Bank, which completed its infrastructure and digital platform build at the end of last year."
Whether the group harbors similar plans to venture into banking in other jurisdictions it has subsidiaries such as Zimbabwe, remains to be seen.
"We are extremely pleased to have received the regulator's go-ahead and look forward to shaking up the financial services space with new innovations and solutions. We can confirm that the launch is on track," Old Mutual CEO, Iain Williamson, said in a statement.
The next steps in the evolution of OM Bank will include integration testing and connecting to South Africa's national payments system.
It has been previously reported that Old Mutual spent R1.75 billion to build its core banking system and committed another R800 million to continue building out OM Bank ahead of a planned public launch before the end of the year.
OM Bank will be targeted at South Africa's mass retail banking market, which is dominated by Capitec with its more than 21 million customers.
