VBS Mutual Bank: how did we get here?
As VBS Mutual Bank makes headlines after the Reserve Bank placed it under curatorship on Sunday, here is what you need to know. 1. What happened on Sunday night? Reserve Bank governor Lesetja Kganyago placed Venda-based VBS Mutual Bank under curatorship. This is the first curatorship in SA since the Bank put African Bank under curatorship in August 2014 after a run on that bank’s money-market funds, which threatened to put SA’s banking system at risk. The Reserve Bank places a bank in curatorship to protect depositors and take risk out of the financial system. 2. Okay, but what is VBS? The bank was established in 1982 and initially operated as the Venda Building Society. It received a permanent mutual bank licence on October 11 2000 and currently has about 30,000 clients. 3. What is a mutual bank? Mutual banks are very different to commercial banks as they follow the Mutual Banks Act as opposed to the Banks Act. They tend to be smaller than commercial banks; some types of deposits i...
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