Stung by BEE

Black economic empowerment has been a big source of profits for South African banks in recent years. But market turmoil means many deals are underwater, and some market participants have likened the situation to the US subprime mortgage crisis. Mark Pengelly reports

Black economic empowerment (BEE) has helped change the economic landscape of South Africa in recent years. The project is an ambitious one: to reverse the inequities of apartheid, which meant that before 1994, control over the country’s corporates remained largely in the hands of the white minority. Most significantly, the demands of BEE have increased black ownership and control over South African business – much of which has been facilitated through substantial transfers of shares to BEE