VBS investors receive 20 cents Christmas bonus

LIMPOPO – Concurrent creditors of VBS Mutual Bank (VBS) will soon receive their second dividend payment amounting to 20 cents in the Rand.

This follows the confirmation of the second liquidation and distribution account by the Master of the High Court on November 8, as required by the Insolvency Act.

Louise Brugman on behalf of the liquidator of VBS, Anoosh Rooplal, confirmed in a media release that the second dividend of 20 cents in the Rand or 20% of concurrent creditors claims against VBS amounts to approximately R458m of which approximately R291m will be paid to relevant municipalities.

Concurrent creditors who lodged valid claims included 13 municipalities, various business depositors, retail depositors and supplier creditors.

Retail depositors included those retail depositors who had claims of over R100 000, after they were paid out up to the first R100 000 through the South African Reserve Bank guarantee via Nedbank. A total of 98% of depositors who had R100 000 or less were paid their monies in full through the guarantee.

Rooplal noted, “This is a substantial dividend and the team is currently verifying all concurrent creditors bank accounts. Payments to all verified concurrent creditors commenced during November 2024 and we anticipate to complete this process by end of January 2025.”

In 2022, the first liquidation dividend of 7 cents in the Rand was paid to all proven concurrent creditors. This amounted to approximately R159m, of which approximately R110m was paid to relevant municipalities.

All preferent and secured creditors were fully paid in the first liquidation dividend distribution.

“We are very pleased with the success that our collection efforts have delivered for creditors, notwithstanding the fact that massive fraud and theft of some R2.3b was perpetrated against this bank. This second dividend distribution brings the current payment to concurrent creditors to R617m,” Rooplal is quoted. He added that concurrent creditors have effectively recovered 25,6% of their monies.

“This is a fantastic outcome given the many challenges that the bank faced. When compared to other liquidations, it is not uncommon to have final recoveries of less than 5%. We have left no stone unturned in our recovery efforts and are elated to have distributed approximately R400m to the municipalities which is effectively a distribution to the South African taxpayers”, continued Rooplal.

The municipalities who had invested public funds into VBS were Makhado, Vhembe, Collins Chabane, Greater Giyani, Ephraim Mogale, Tubatse Fetakgomo and Lepelle-Nkumpi in Limpopo.

Polokwane and Capricorn District municipalities withdrew their deposits when it became known that municipalities were not allowed to deposit funds at a mutual bank.