More that 400 employees of the mothballed Ithala bank in KwaZulu-Natal are facing a bleak weekend after they were informed on Wednesday this week that they may not get their June salaries on time.
The staff is supposed to get paid on June 20. But that may not happen as the Repayment Administrator (RA), Johan Kruger, who is overseeing the affairs of the bank, has not granted executives access to the systems to process the payments.
This would not be the first time they are subjected to late payments since the RA took over the bank’s operations.
Staff memo
The bad news was communicated to the already dejected staff through a memo dated June 18. It was signed off by Fikile Sithole, the People Business Partner, and Obo Dr Theo Nell, identified as the CPO.
“Dear colleagues, Please note that Ithala SOC might not be able to pay salaries on time this month. The Repayments Administrator has not released access to our accounts. And as a result, salaries might not be paid on 20th June 2025 as alternative funding is being sourced.
“We know everyone is under tremendous pressure. And this situation is causing a lot of distress to everyone.
“Please be assured that management is doing everything in its power to arrange for salaries to be paid as soon as possible. Further updates will be provided as soon as more information is available,” reads the memo.
Bantustan bank
The historic bank was founded by the the then KwaZulu Bantustan government during apartheid. It was meant to serve black people within the homeland. However, it is currently mothballed, as the Prudential Authority (PA), an entity of the South African Reserve Bank (SARB), wants to liquidate it for trading without a licence and for flouting several banking rules.
The PA is also claiming that the bank is effectively bankrupt after engaging in reckless lending practices for years.
Last month, Ithala bank won a court case to resume operations. But Kruger and the PA appealed the ruling with the Supreme Court of Appeal. This effectively froze the reopening of the bank, and the appeal would be heard on July 25 2025.
