African Bank ‘stabilised’

2014-12-10 12:45

Operations at African Bank have been stabilised and restructuring is on track, the bank’s curator has said.

“We believe we have stabilised operations, we are committed to delivering a good bank,” Tom Winterboer told journalists in Joburg today.

“I think we are in a good position.”

The bank was placed under curatorship on August 10 after it warned of massive losses and said it needed about R8.5 billion in new capital.

A consortium involving major banks had committed to underwrite a R10-billion capital raising and would talk to shareholders and other participants, then South African Reserve Bank governor Gill Marcus said at the time.

Winterboer said the bank continued to perform its functions.

“I go to branches and am encouraged by the professionalism and also at the call-centre, and that is very good to see.

“We have settled the liquidity crisis and upped our sales targets ... New applications have picked up,” Winterboer said.

A new credit score had been developed.

“The new credit score is to improve our credit mix or quality of our business and ability to collect,” he said.

The bank’s new loans were up by 10% and there had been no retrenchments since the start of the curatorship.

“We lost people at the commencement of the curatorship and we have replaced those. There have been no retrenchments during this four-month-long curatorship process,” said Winterboer.

“It has been an interesting journey in the last four months. We are looking at the plans for a new bank going forward to make sure that African Bank is efficient.”

Eight potential new board members had been identified, and needed to be approved by the Reserve Bank. The appointment of board members would be followed by that of a new chief executive.

At least R26 billion worth of core lending assets would be transferred to the new bank once it was established in the first quarter of 2015.

The new bank would retain the name African Bank.

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