Ithala bank court saga continues

Finance MEC Francois Rodgers welcomed the announcement of a new date for the hearing of the appeal by Johannes Kruger, appointed as South African Reserve Bank (SARB) Repayment Administrator (RA) in the matter involving Ithala bank.

The matter is expected to be heard in the Durban division of the KZN High Court on 25 July.

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In the Pietermaritzburg division of the High Court in May, Judge Muzi Ncube ruled that Kruger had overstepped his mandate, which relates only to the deposit book and that he had no mandate to take over all other operations of Ithala.

Judge Ncube further ruled that Ithala should resume its core business activities, excluding deposit-taking and transacting. This ruling followed court proceedings that were heard in the Labour Court in Durban in March.

Undeterred by another court loss, Kruger opted to appeal Judge Ncube’s ruling, causing a delay in the resumption of Ithala activities.

Rodgers said this was an action that affects KZN’s most vulnerable, including pensioners, taxi drivers, SMME owners and domestic workers, among others, whose accounts remain frozen as the alleged attempts of Ithala’s systemic collapse persist.

“It appears that the RA, in their actions and instructions, are to the detriment of Ithala’s depositors for whom we have been fighting. It is a common cause that Ithala serves a niche market of mainly rural citizens in KZN. Many of Ithala’s customers may not find similar services and assistance in the commercial banks,” said the MEC.

Rodgers said he was concerned by what appears to be ‘fruitless and wasteful’ in Kruger’s failed litigation attempts.

“We will be submitting a question in the National Assembly to establish how much the RA has been paid by the SARB’s Prudential Authority so far, and a quantification of their litigation cost.

“I still maintain that the matter can be resolved amicably by all relevant stakeholders, including National Treasury, if the parties were willing to engage on the matter,” said Rodgers.

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