Workers deserve stake in African Bank – Cosatu

Trade union federation Cosatu says it will be engaging the Public Investment Corporation (PIC), which invests on behalf of the Government Employees Pension Fund (GEPF), as well as the government, to push for workers to be included as owners of African Bank.  

“This can come in the form of shares owned by African Bank employees as well as a strategic stake by the PIC,” Cosatu spokesperson Matthew Parks told Sunday World this week. 

The African Bank Group has reported an encouraging turnaround in its consolidated unaudited interim financial results for the six months ended March 31, 2024. 

The bank achieved a net pro-fit of R203-million and a reduction in impairments of 40% through a tightening of lending criteria and a shift in its net advances mix.  

The group has also recorded a 38% increase in its customer base, which currently stands at 5.7-million. 

Parks said Cosatu welcomed the successful intervention and turnaround strategy led by the South African Reserve Bank.  

“We support the broad-based black economic empowerment strategy about its ownership as the banking sector has not moved at the pace the country expects regarding transformation and diversity,” he said. 

“Cosatu will be engaging the PIC who invest on behalf of the GEPF as well as the government to push for the workers to be included as owners of the bank,” Parks said. 

 Group CEO Kennedy Bungane said despite operating in a tough economic climate, the results reflected a turnaround of African Bank.  

“This was bolstered by the integration of Grindrod Bank into the Business Banking division, a move that received regulatory approval in March.  

“The acquisition positions African Bank to better serve underserviced small, medium, and micro enterprises and entrepreneurs, aligning with its foundational vision in the business banking sector,” said Bungane. 

Respected businessman, publisher and activist Dr Thami Mazwai praised the strides the African Bank was making to have a consortium of black businesspersons partake in the acquisition of a majority stake in the banking business. 

Mazwai, a former Robben Island political prisoner, and visiting professor of entrepreneurship at the University of Western Cape and chairman of Mtiya Dyna-mics, said this move was long overdue, “and should have happened a long time ago”. 

“This initiative by the African Bank reflects the vision espoused by people such as Dr Sam Motsuenyane, the founding father of the National African Bank during the difficult period of apartheid and discrimination, who was also a pioneer of the National African Federated Chamber of Commerce and Industry,” said Mazwai. 

“Cosatu and Nactu were integral part of the liberation struggle and played a critical role in the liberation of our people. I will be glad if this will also be expressed in economic participation of these trade union federations,” Mazwai said. 

The bank maintains a surplus liquidity of R7.9-billion in cash reserves, excluding statutory asset requirements. The capital adequacy position remains robust at 32.5%, despite recent acquisitions, exceeding both regulatory and internal minimums. 

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