VBS bank cuts 94 jobs in aftermath of R2bn fraud

2018-10-17 17:40
VBS CEO Andile Ramavhunga. (Photo: Netwerk24)

VBS CEO Andile Ramavhunga. (Photo: Netwerk24)

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VBS Mutual Bank will retrench 94 employees, leaving the beleaguered bank with just 26 staff members made up of two general managers, admin staff and a collections team.

The job cuts have been under discussion since July this year after VBS was placed under curatorship in March by the South African Reserve Bank.  

In a statement released on Wednesday, curator Anoosh Rooplal said that the reduction in staff was a necessary step to reduce costs for the bank.

"In accordance with the [Labour Relations] Act the team engaged with the relevant union Sasbo (South African Society of Bank Officials), as well as non-unionised members through a chosen representative to proceed with the section 189A process," Rooplal said.

He added that the Commission for Conciliation, Mediation and Arbitration was involved early in the retrenchment process.

READ: Mariette Venter, VBS and the resistance against the looting of the state

Last week the Reserve Bank published a final forensic investigation report, compiled by advocate Terry Motau, into the collapse of VBS.

Motau found wide-scale looting totalling nearly R2bn had led to the bank's liquidity crisis.

Rooplal told News24 in a written response to questions that he was working to conclude the retrenchment process. The packages for the staff include notice pay, severance pay and accumulated leave.

Eighty-three of the 94 staff were also eligible for a 13th cheque.

"Notice end dates will vary depending on the time that the employee has worked for the bank, with the latest date being 12 November 2018."

Rooplal also expanded on other cost-cutting measures that have been undertaken since the commencement of the curatorship.

Less frequented branches in Thavhani, Johannesburg, Durban and Sibasa were shut down.

"We will now downsize the two remaining branches in Thohoyandou and Makhado, such that customers who have loan accounts with us can still continue to come in and pay their loans," he said.

Other steps, including moving all the remaining staff into a single block at the VBS headquarters and eliminating non-critical expenses, were also taken to cut costs, Rooplal explained.

Employment contracts have been finalised with the remaining 26 staff members and retrenchment packages have been "issued" for 94 others.

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