As the battle to save Ithala Bank rages on in the country’s courts, the Premier of KwaZulu-Natal, Thamsanqa Ntuli, wants provincial government departments and municipalities to bank with the historic bank once it has been fully saved.
Ntuli believes that this would help the bank to thrive and become more viable.
High court ruling
He sounded this call on Wednesday in Durban after the Pietermaritzburg High Court ruled that the bank can continue operating while the application by the Prudential Authority (PA) to liquidate it is underway.
The PA and Johan Kruger, the repayment administrator, are challenging that ruling in the Supreme Court of Appeal (SCA), insisting that the bank is insolvent and it should halt its operations.
Unfazed by that, Ntuli said the the bank’s customers and other citizens should have faith and continue banking with it.
“People who bank with Ithala should continue doing so because we have an obligation to keep the bank open. We are also calling on the provincial government that departments, municipalities and all other organisations should open bank accounts with Ithala. We now all know that Judge Ncube ruled that Ithala was not supposed to be interrupted from doing business,” Ntuli said.
More than R2bn trapped in bank
Currently, over R2-billion of depositors’ money is trapped with the bank’s 398 000 accounts. Attempts are now underway to ensure that the bank is reopened so that they can access their money.
Additionally, at the press conference, Ntuli spoke about how some businesses had to scale down on their operations because of their money trapped with the bank.
In KwaDukuza, a young farmer, Mr Mhlengi Ngcobo, is struggling to keep his hydroponic farm operational. With his Ithala account frozen, he has been unable to purchase critical agrochemicals and fertilisers. He was forced to dismantle 10 of his farming tunnels after crops spoilt, and, heartbreakingly, he has had to lay off five employees.
Clients battle as money is frozen
He also recounted the sad story of Zandile Mnguni from Ulundi, whose children are now out of school because she could not access the funds in her Ithala account to pay tuition.
“One of her children was enrolled at Berea Tech and is now sitting at home. To make matters worse, her home was recently damaged in severe flooding. But she is unable to fund repairs despite having the money – locked and inaccessible.”
