The effectiveness of the twin peaks model regulation in South African banking sector

Abstract

The key motive of completing the study is to discover the effectiveness of Twin Peaks framework regulation within banking sector in the Republic of South Africa. There are several of jurisdictions globally that have introduced the Twin Peaks framework. Twin Peaks framework evidently seem expensive to implement within the country. National Treasury (2011), states that benefits in implementing Twin Peak framework of financial regulation outweighs the associated cost. The problem being explored in the study is that the effectiveness of the Twin Peaks is unknown since the regulatory framework was introduced in the country. A quantitative research methodology was used. The self-designed questionnaire was designed in line with five point lickert scale applied as data collection instrument from 81 respondents within the bank. The population consist of Compliance Analysts, Compliance Monitoring Analysts, Compliance Specialists, Compliance Officers, Compliance Managers, Head of Compliance and Legal Officer/ Legal Counsel. The study looked at the respondents’ gender, age, level of education, position in the banks and perceptions thereof regarding implementation of Twin Peaks framework in South African banking sector. The results of this study indicate that the introduction of Twin Peaks model framework regulation in banking sector is effective and data clearly illustrates that the respondents appear to understand the factors, perception of the regulators and bank and the variables that are applied to measure the Twin Peak model regulation. The respondents view Twin Peaks model as instrumental to the resilient, stable and inclusive financial sector and designed to stabilise the financial system. The regulators should develop rigorous regulations and that seek to improve and empower consumer protection from unfair trade practices and market abuse from the banks. The banks should design and embed policies that promotes treating customers fairly and be clearly articulated to the employees within the banks.