News 12.3.2018 05:04 pm

VBS curatorship ‘shouldn’t have been first intervention’

Reserve Bank governor Lesetja Kganyago. (Photo by Gallo Images / Business Day / Trevor Samson)

Reserve Bank governor Lesetja Kganyago. (Photo by Gallo Images / Business Day / Trevor Samson)

The Black Management Forum hopes VBS will soon be back to a having a fully operational board and executive.

The Black Management Forum (BMF) has questioned the decision taken by the South African Reserve Bank (Sarb) to place Venda Mutual Bank (VBS) under curatorship.

“The curatorship process should not have been the first method of intervention in assisting the bank with its liquidity challenges. The BMF is of the view that the Reserve Bank and National Treasury should use this process as an opportunity to move faster and address a sharp observation of the joint committees,” BMF said in a statement.

The business formation noted that the portfolio committee on trade and industry and the standing committee on finance observed that “the main banks in South Africa function in a globalised financial system and that there are imperatives for the country to meet the requirements of global standards on the financial sector set by multilateral institutions in which South Africa participates”.

It also recalled that the committees believe that National Treasury and government in general shaped policies and bills too much on the basis of these standards and too little on the specific requirements of the country.

RELATED: The Black Business Council ‘dismayed by negative reporting on VBS’

“Some of these standards could serve to undermine the goals of economic and social transformation in the country and exacerbate race, class, gender and other inequalities. The BMF will seek to engage with the management, shareholders, relevant key stakeholders of VBS as well as those from Treasury to get the full details and context on this matter and decision taken.

“The BMF hopes that the outcome of the consultations with the relevant parties concerned will get VBS back to a fully operational Board and Executive to a sound footing. The BMF urges that the VBS commercial licensing application process be expedited to ensure that they do not wait the normal 12 – 18 months review period,” said BMF.

Meanwhile, Jabulani Sikhakhane, the divisional head of communications at the Sarb, confirmed that “as explained by Deputy Governor and the Registrar of Banks, Kuben Naidoo, at yesterday’s media briefing, VBS Mutual Bank submitted its application for a commercial banking licence on the 26th of February 2018″.

“It takes 12-18 months to process a banking licence application, depending on the quality of information that the applicant supplies to the registrar,” explained Sikhakhane.

Also read:

SA civic organisation calls for action against municipalities over VBS Bank investments

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