Reserve Bank had no choice but to ask for liquidation of VBS, Kuben Naidoo says
The Bank's deputy governor says creditors can hope to receive only 20c-30c on the rand once the liquidation is final
The Reserve Bank had no option but to apply for the liquidation of VBS Mutual Bank once it had evidence that it was insolvent, deputy governor and Prudential Authority CEO Kuben Naidoo said on Wednesday. There have been calls from several quarters, including from the EFF, for the bank to be salvaged. EFF MP Mbuyiseni Ndlozi said that looking back at previous Reserve Bank interventions with troubled banks, it was the practice to try to save them. But this was not the case with VBS which the Bank, according to him, was hellbent on killing. Parliament's finance committee has also stated that it wants VBS to be revived, and it regarded the collapse of the bank as a “severe setback” to transformation and diversity of the financial services sector. Naidoo said in a presentation to the committee that VBS was “massively insolvent” to the tune of about R372m. A report on VBS found that massive fraud had been committed with about R1.9bn being looted from the bank. The Reserve Bank applied on ...
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