Teba Fund Trust (Teba), which administered Ubank until it was placed under curatorship, says it has not received the proceeds of an R80m sale of the bank to African Bank. It wants the governor of the Reserve Bank and the finance minister to intervene.
In a letter addressed to the Bank's governor, Lesetja Kganyago, and finance minister Enoch Godongwana dated September 22 2022, Teba chair and former National Union of Mineworkers (NUM) president Joseph Montisetse says the board of Ubank and Teba trustees remain in the dark and don't know why the matter cannot be concluded.
“We are gravely concerned that the continuing cost under the curatorship is eroding the shareholders' value and constraining the trust in carrying out its objectives as well,” he wrote.
The Bank placed Ubank under curatorship in May last year to protect depositors' money owing to capital adequacy and corporate governance concerns. At the time it was placed under curatorship, the bank — which provides basic financial services to miners and their families — had 4.7-million accounts. It was administered by Teba, NUM and the Minerals Council South Africa.
Zola Beseti, a director at KPMG, was appointed curator.
Montisetse said he had tried to engage with the curator on how the sale was proceeding and the process of transferring the assets of UBank. He said it was unethical that the costs of the curatorship were being borne by Ubank a year after its reported sale to African Bank.
We are gravely concerned that the continuing cost under the curatorship is eroding the shareholders' value and constraining the trust in carrying out its objectives as well
— Joseph Montisetse, Teba Fund Trust chair
“If it is true that African Bank bought the book [last year], and we are sitting here in September 2023, which is a year later, and we have not received any report, the costs of the curatorship should be borne by the Reserve Bank, as we deem the costs unnecessary and also unethical.”
Speaking to Business Times, Montisetse said the trust, as the owners of the bank, had been opposed to the sale and preferred a capital injection to sustain the financial institution. He said Nigeria’s Access Bank was ready to inject R1bn into Ubank and partner with it to extend its footprint in other parts of the continent.
However, Access Bank's bid was rejected by the Bank and the finance minister. The two said Ubank had to be sold or its licence would be withdrawn, which would have led to its liquidation.
“We were under pressure because Ubank is a mineworkers' bank, which means if it is liquidated the mineworkers will look at NUM and say: 'We want our money.' There was nothing we could [do] but agree [to it being] sold to protect the assets of mineworkers.”
He said the curator remained mum on the R80m paid by African Bank to acquire Ubank — money that belongs to trustees.
“Our problem now is that the curator does not want to give us the money as the trust and the owners of the bank. That R80m is sitting with him. We have tried everything, [but] he does not respond or avail himself for meetings we call him to be part of.”
Montisetse was adamant the governor had to intervene, but said their letters had not yet been acknowledged.
“So the governor who appointed the curator should intervene. We want him to instruct the person [and] say: 'I appointed you for a certain period, that period expired a long time ago, and you should hand over everything you have to the trust and leave the place.'
“We are disappointed in that because we believe they are the people responsible for the sale of Ubank. We don’t know if they do not want to communicate with us. Where should we go, because they are in a place of responsibility?”
Bank spokesperson Ziyanda Mtshali said they had not received any correspondence from Teba.
She confirmed Teba had not received the proceeds of the sale.
“The proceeds are held within UBank, which is currently in curatorship.
“The decision to lift the curatorship will be made by the minister of finance, as he appointed the curator. There was no specified term set for the appointment of the curator,” Mtshali said.
