Plans to revive VBS bank continue

accreditation
SA Reserve Bank this week confirmed that it was not possible to give the licence to another individual or another entity.
SA Reserve Bank this week confirmed that it was not possible to give the licence to another individual or another entity.

NEWS


Following numerous calls for a revival of the looted VBS Mutual Bank, the SA Reserve Bank this week confirmed that it was not possible to give the licence to another individual or another entity.

“The banking licence under which VBS Mutual Bank operated was suspended. VBS Mutual Bank, in its old form, cannot be revived. The old VBS Mutual Bank banking licence cannot be bought by another party,” it said.

The Reserve Bank’s Prudential Authority, however, has noted that it would be willing to continue to engage with community members who are showing an interest in opening a similar bank.

“If anyone wishes to apply for a new mutual or commercial banking licence, they’re welcome to do so. Any party wishing to buy any of the assets of the old VBS Mutual Bank may do so, through the liquidator.”

The Prudential Authority said that, in the case of a new bank, there was a legal process that had to be followed to obtain permission to use the name VBS.

“This process would be similar to the new licence granted to the resuscitated African Bank after the old African Bank was placed into curatorship in 2014,” said the Reserve Bank.

The Reserve Bank’s Prudential Authority, however, has noted that it would be willing to continue to engage with community members who are showing an interest in opening a similar bank

A letter from the Matsila Community Development Trust on behalf of the VBS Shareholders’ Forum was sent to the Reserve Bank last month.

The correspondence requested that the Reserve Bank, with the assistance of its governor Lesetja Kganyago, facilitate a meeting with a view to initiating a process to restore the bank.

Speaking to City Press about the matter, Matsila Community Development Trust founder Chief Livhuwani Matsila said the meeting would most likely take place next week, and added that he and the shareholders were willing to explore the prospects of opening a new bank to service the community.

“We expect that all the nitty-gritties about the banking licence will be put before us so that we’ll know how we can revive VBS bank, in one form or the other.

“The issue isn’t necessarily VBS as such – it’s about having our own banking facility as a community, because VBS was destroyed because of the looting. We think the Reserve Bank will give us proper advice on how to go forward,” said Matsila.

However, he added that it was unfortunate that he had had to obtain information about the bank’s licence from the media – the trust had not yet received any formal information to this effect.

Read: Efforts to revive VBS Bank under way

Matsila strongly believes that the Reserve Bank was supposed to meet with the relevant stakeholders before deciding to release such information.

He said they would be raising this matter in the meeting.

Groupings falling under the Vhembe Fraternal Organisations were also in favour of re-establishing the bank.

The umbrella body consists of the ANC Veterans’ League, trade union federation Cosatu, the SA Municipal Workers’ Union, the Congress of Traditional Leaders of SA, the National African Federated Chamber of Commerce and Industry, the ANC MK National Council, the Pastors’ Forum and the VBS Shareholders’ Forum, among other entities.

“This statement was released on Friday. We’ll have a response once we’ve had a meeting,” Robert Lovhoyi, secretary of the VBS Shareholders’ Forum, told City Press.

The bank was placed under liquidation on November 13 2018, and the collection of loans is continuing as assets are being sold to recover money owed to depositors.

If anyone wishes to apply for a new mutual or commercial banking licence, they’re welcome to do so. Any party wishing to buy any of the assets of the old VBS Mutual Bank may do so, through the liquidator
SA Reserve Bank

“The Reserve Bank has provided R261 million, covering over 97% of retail depositors who originally deposited with VBS Mutual Bank. To date, more than 98% of deposit balances guaranteed by government have been claimed,” said the Reserve Bank.

A sum of R2 billion was looted from the bank by senior officials.

Eight suspects have been arrested in connection with the heist. The alleged kingpin is former VBS and Vele Investments chairperson Tshifhiwa Matodzi.

The others are VBS chief executive Andile Ramavhunga, former chief financial officer Philip Truter, former VBS treasurer Phophi Mukhodobwane, and former non-executive VBS board members Ernest Nesane and Paul Magula, as well as former KPMG engagement partner Sipho Malaba, and Phalaphala Avhashoni Ramikosi, the former chief financial officer of the SA Police Service.


facebook
twitter
linkedin
instagram

Queenin Masuabi 

Political Journalist

+27 11 713 9001
Queenin.Masuabi@citypress.co.za
www.citypress.co.za
69 Kingsway Rd, Auckland Park

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For only R75 per month, you have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today.
Subscribe to News24

E-Editions

Read the digital editions of City Press here.
Read now
Voting Booth
The Electoral Commission of SA (IEC) has accepted the report by former Deputy Chief Justice Dikgang Moseneke proposing that South Africa’s local government elections be postponed to February.
Please select an option Oops! Something went wrong, please try again later.
Results
I was looking forward to the elections in October
42% - 154 votes
Postponement makes sense
46% - 170 votes
They should be later than February
13% - 47 votes
Vote