THE tense saga surrounding Ithala SOC Limited, a black-owned bank pivotal to the financial well-being of many in KwaZulu-Natal, has taken a dramatic turn as the Pietermaritzburg High Court case, initiated by the Prudential Authority (PA) for the bank's liquidation, has been postponed from Wednesday to Thursday...
In the interim, approximately 65,000 social grant recipients who receive payments via Ithala Bank have been urged to visit FNB to open new bank accounts between January 28 and February 4, which would enable them access to their funds during the next payment run, using their IDs.
Premier Thamsanqa Ntuli held a media briefing in Durban, accompanied by MEC for Economic Development, Tourism and Environment Affairs, Reverend Musa Zondi, on Tuesday, expressing firm resolve to not only challenge the allegations levied against Ithala but also to preserve a crucial banking institution that serves marginalised communities across the province.
The looming liquidation stems from claims by the PA of alleged insolvency and non-compliance, yet Ntuli has questioned the motives behind these actions.
Ntuli asserted, “We must question the timing and motives behind the recent actions of the RA (Repayment Administrator) and PA to halt Ithala SOC’s operations. This intervention, imposed at the end of the month, disrupts critical services, including the processing of salaries, payment of policies, and preparations for the return to school.”
He further labelled the PA's Johan Kruger as having questionable motivations, alleging that the aggressive approach used in the matter raised suspicions about their intentions to dismantle Ithala.
“We firmly believe that if there were no ill intentions toward dismantling Ithala, the Prudential Authority would have opted to provide guidance and support to address any compliance concerns.”
Ntuli expressed his suspicion about a conspiracy to collapse Ithala Bank to allow larger commercial banks to absorb its clients, numbering roughly over 257,000.
“We will fight to ensure that Ithala does not collapse... There is a deliberate ploy to destroy Ithala,” he declared, emphasising that the fight would remain within legal avenues. The Premier lauded Ithala as a bastion of hope and empowerment for historically under-served communities in KwaZulu-Natal.
Ntuli also revealed a productive dialogue with President Cyril Ramaphosa regarding the matter, saying, “My discussion with the president was both productive and constructive... as the provincial government, we will not allow any agenda to derail the critical role Ithala plays in empowering our people.”
Echoing this sentiment, MEC Zondi expressed concerns about the ramifications of PA’s actions on the impoverished clientele dependent on Ithala’s services: “What is happening is that people’s money is kept away from them, and that is illegal. We will fight to ensure that people have access to their funds.”
Political parties across the spectrum, including the ANC and the DA, have united to protect Ithala Bank, with additional support from advocacy groups ensuring the bank’s survival. The late Inkosi Mangosuthu Buthelezi’s son, Inkosi Zuzifa Buthelezi, joined the cause by initiating a petition aimed at saving the institution.
As the legal teams navigate a pathway forward, the next steps regarding the application for liquidation by the Prudential Authority are highly anticipated, with a date for the court hearing in Pietermaritzburg to be revealed soon.
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DAILY NEWS