KZN Treasury backs Ithala's fight against liquidation
KwaZulu-Natal Treasury has decided to support Ithala Bank in its bid to challenge a provisional liquidation application.
Treasury says it has submitted its own legal documents.
This follows the Prudential Authority, a regulator under the South African Reserve Bank, filing an application in the Pietermaritzburg High Court at the beginning of January seeking the provisional liquidation of the state-owned bank.
It argued that the move is necessary to protect the interests of Ithala's quarter of a million depositors.
The PA says the entity has failed to obtain a banking licence despite being granted a temporary exemption while it sorted out its operations.
A repayment administrator appointed by the Authority to investigate Ithala’s operations has since found that the bank was technically and legally insolvent.
READ: ANC in KZN vows to fight Ithala liquidation
KZN Treasury says the liquidation will affect those who rely on the Ithala bank.
“Mr Francois Rodgers, say it is KZN Treasury’s contention that Mr Johannes Kruger has not acted in the best interests of Ithala’s depositors, workers, suppliers, and clients. In fact, the callous action of Mr Kruger has placed at risk countless SASSA beneficiaries and sets out to worsen the concerning high unemployment and poverty rate in the province."
“We are further aggrieved to learn that Mr Kruger does not want the entity to pay the February salaries of Ithala staff members. This demonstrates a lack of care for people’s livelihoods,” said KZN Treasury spokesperson Nkosikhona Duma.
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