Expert blames mismanagement for collapse of Ithala

Expert blames mismanagement for collapse of Ithala

An economist says he believes the collapse of Ithala is due to mismanagement.

Liquidation of Ithala Bank 'premature' - KZN Legislature
Supplied

Dawie Roodt, the chief economist at the Efficient Group says this is another example of a state owned enterprise that has been misused. 


"This is another state assets that has been mismanaged and I have a suspicion that it's the most important why the bank went under because people were appointment but were not up to doing the job." 



The Prudential Authority has approached the Pietermaritzburg High Court to apply for Ithala to be provisionally liquidated.


It's after an investigation found that the state owned entity which operates primarily in rural areas was technically and legally insolvent.


READ: Ithala: KZN Treasury backs liquidation challengeIthala: KZN Treasury backs liquidation challenge


Ithala has over 250 thousand depositors and KZN Treasury has assured the that government will work to protect their funds.


Dawie Roodt says government should let the private sector run state owned enterprises, "The private sector is just better at doing these kind of things. 


We can see in most state owned enterprises in South Africa are also in deep trouble, because they are ultimately under control by politicians. 


Roodt says to prevent something like this happening again, is to not open another state bank " and secondly, trying to sell the existing state assets which is unlikely to happen." 


newswatch new banner 3

More on ECR


Show's Stories