Abil’s ‘bad bank’ turns to profit, but remains under curatorship
Residual Debt Services reported a profit of R4m for its 2018 financial year, but its liabilities still exceed its assets
Residual Debt Services (RDS) — the “bad bank” separated from the formerly JSE-listed African Bank Investment Limited (Abil) that went under curatorship in 2014 — reported a R4m profit for the year to end-September. But RDS will remain under curatorship for the foreseeable future until its assets cover its liabilities, its results statement released on Monday said. RDS was separated from the group in 2016 as part of the salvage operation of the “good bank”, which resumed trading as African Bank. At September 30, RDS’s liabilities exceeded R9.8bn, almost double its assets of R4.62bn, leaving it negative equity of R5.2bn. Curator Craig du Plessis said the bank will, however, be able to pay about R650m to its senior unsecured and subordinated debt holders by the end of January 2019. This will increase total payments made to these debt holders to R1.8bn to date. Although RDS recorded a loss of R97m from operations, this was offset by income from capital items, which increased to R99m as ...
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