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Papers filed to liquidate 'hopelessly insolvent' VBS

Publish date: 02 November 2018
Issue Number: 46
Diary: CompliNEWS
Category: Banking

Legalbrief Today

The Prudential Authority (PA), formerly known as the Registrar of Banks, has filed court papers seeking the liquidation of VBS Mutual Bank. In a press statement issued yesterday, the PA confirmed it had filed the application with the Gauteng High Court (Pretoria). 'Whilst VBS is under curatorship pursuant to a decision taken by the Minister of Finance on 10 March 2018, the PA is of the view that curatorship must now be terminated and VBS must be placed in final winding-up,' the statement reads. It said this was because 'VBS is hopelessly insolvent and massive frauds have been perpetrated against it'. As a result, there was no prospect of entering into any resolution plan in respect of VBS, it added, saying the liquidation was in the best interests of all parties. The final winding-up was also recommended in the investigation report by Advocate Terry Motau that was made public this month. The PA expects the application to be set down for 13 November, notes News24. The Mahikeng Local Municipality had also filed a liquidation application with the Limpopo High Court. In the statement, the authority said Mahikeng's application was flawed. 'The PA is of the view that the Mahikeng Local Municipality's application is defective for a number of reasons, including that it is the PA who should terminate curatorship by liquidation. The PA has not been joined in the Limpopo High Court application and it is the Gauteng High Court (Pretoria) which exercises jurisdiction in this matter,' the statement concluded.

Full News24 report

Liquidation application


Working Smart

 By Lee Rossini

Andile heads up the administration department of a financial services provider (an FSP). He receives the application forms from the financial advisers after they have recommended a particular product to a client. He picks up that there is a big delay between the financial advisers seeing the client and the forms reaching his department. As a result, he is receiving a lot of complaints about delays. After a brief discussion with a senior manager, they decide that the financial advisers should attend a time-management training programme the following week in the hope that it will solve the problem. Andile outsources the training to a company that specialises in courses of this nature. The financial advisers attend the course and the evaluations indicate that they enjoyed it and anticipate that the newly acquired skills will assist them to perform their jobs better. Andile anticipates an improvement in their performance, but unfortunately this never happens.

What went wrong and why didn’t Andile get the results he was expecting?


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