Meshack Mabogoane
When the African Bank went through its first major scam involving forex irregularities in 1988, the Reserve Bank seconded Jack Theron, an experienced banker from Trust Bank, to take over from then-chief executive Moses Maubane. Theron’s brief was to salvage the mess, then hand the reigns back to a black chief executive.
Ironically it is Theron — who went on to become chief executive and stayed until his resignation a few weeks ago — who is at the centre of the latest storm which has sent Afbank to insolvency and brought the Reserve Bank to intervene yet again.
Theron, an amiable, well-heeled technocrat, is said by a former senior Afbank executive to have “lacked the vision and commitment necessary to drive a growing institution”. He is also alleged to have misused his position to offer himself and others doubtful loans — worth R17-million– in spite of objections by senior staff. Theron has denied the charges and says he “has nothing to hide”.
Registrar of Banks Christo Wiese this week called for a commission of inquiry to investigate the causes of the bank’s collapse, an exercise that could take six months.
Meanwhile, Afbank has reopened for limited business. Though depositors had earlier stormed many branches to demand their money, it turns out there has been no real rush on the bank. With a back-up allocation of R26- million from government to enable savings account holders with up to R10 000 to withdraw up to R500, less than R4-million of the amount had been been taken by mid-week. Curator John Louw attributes this to client confidence in the bank.
This signal of support is in line with attempts to rescue the bank. New Africa Investments Ltd (Nail), which brought the alleged irregularities to light, is taking the lead to salvage Afbank. Nail, which has a 25 percent stake, and its subsidiary Metropolitan Life, which has another 17 percent, together are the largest and most substantial shareholders. Prospects, according to Louw, “are good”.
In an added twist, the government, which has been called on to assist in restoring Afbank, is reported to have withdrawn R38-million of investments it had in the bank over the past nine months.
This excludes the Mandela Children’s Fund, which also withdrew its deposits just before the Reserve Bank moved on Afbank. The money was redeposited on the orders of President Nelson Mandela after allegations that insider knowledge had precipitated the withdrawal. It is accepted Mandela had not personally ordered the